Energy Use and GDP in Israel

The paper aims to study the relationship between energy use and GDP in the period 1971-2007 for Israel with a time-series approach. Stationarity and unit root tests reveal that both series are non-stationary, or I(1). Moreover, since both series show the presence of a structural break, the Gregory and Hansen cointegration test has been conducted. The results evidence the presence of a long-run relationship. Causality tests reveal that the “conservation hypothesis” emerges, since the causality flow runs from aggregate income to energy use. The IRFs analysis evidences that a shock to the energy use affects GDP for one period, but dies out very quickly. While shocks to GDP create a smaller but significant response in the energy use, although it falls to zero in few periods. Finally, we calculate with an ECM that the total long-run multiplier is 0.95. The energy use will increase to correct the disequilibrium, with 68% of the (remaining) deviation corrected in each subsequent time period. In addition, a one-unit increase in the GDP immediately produces a 0.18 unit increase in the energy use.

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Electricity consumption and economic growth in ASEAN

Journal of Emerging Economies and Islamic Research ◽

10.24191/jeeir.v5i2.8801 ◽

2017 ◽

Vol 5 (2) ◽

pp. 16

Author(s):

Ahmad Ghazali Ismail ◽

Arlinah Abd Rashid ◽

Azlina Hanif

Keyword(s):

Economic Growth ◽

Energy Use ◽

Electricity Consumption ◽

Panel Estimation ◽

Real Gdp ◽

Long Run ◽

Bidirectional Relationship ◽

Short Run ◽

Using Data ◽

The Relationship

The relationship and causality direction between electricity consumption and economic growth is an important issue in the fields of energy economics and policies towards energy use. Extensive literatures has discussed the issue, but the array of findings provides anything but consensus on either the existence of relations or direction of causality between the variables. This study extends research in this area by studying the long-run and causal relations between economic growth, electricity consumption, labour and capital based on the neo-classical one sector aggregate production technology mode using data of electricity consumption and real GDP for ASEAN from the year 1983 to 2012. The analysis is conducted using advanced panel estimation approaches and found no causality in the short run while in the long-run, the results indicate that there are bidirectional relationship among variables. This study provides supplementary evidences of relationship between electricity consumption and economic growth in ASEAN.

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FDI and Economic Growth in EU13 Countries: Cointegration and Causality Tests

Journal of Competitiveness ◽

10.7441/joc.2020.03.03 ◽

2020 ◽

Vol 12 (3) ◽

pp. 47-63

Author(s):

Vlatka Bilas ◽

Keyword(s):

Economic Growth ◽

Growth Rate ◽

European Union ◽

Annual Data ◽

Foreign Direct Investments ◽

Causality Test ◽

Panel Ardl ◽

Long Run ◽

Causality Tests ◽

The Relationship

Foreign direct investments are seen as a prerequisite for gaining and maintaining competitiveness. The research objective of this study is to examine the relationship between foreign direct investment (FDI) and economic growth in “new” European Union member countries using various unit root, cointegration, as well as causality tests. The paper employs annual data for FDI and gross domestic product (GDP) from 2002 to 2018 for the 13 most recent members of European Union (EU13): Bulgaria, Croatia, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia and Slovenia. An estimated panel ARDL (PMG) model found evidence that there is a long-run equilibrium between the LogGDP, LogFDI and LogFDIP series, with the rate of adjustment back to equilibrium between 3.27% and 20.67%. In the case of the LogFDI series, long-run coefficients are highly statistically significant in all four models, varying between 0.0828 and 0.3019. These coefficients indicate that a 1% increase in LogFDI increases LogGDP between 0.0828% and 0.3019%. Results of a Dumitrescu-Hurlin panel causality test indicated that a relationship between the GDP growth rate and FDI growth rate is only indirect. Finally, only weak evidence was shown that FDI had a statistically significant impact on GDP in the EU13 countries over the period 2002-2018. This report of findings contributes to the literature concerning FDI and economic growth, namely regarding the current understanding of the relationship between these two factors.

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An analysis of the relationship of inflation and unemployment to the gross domestic product (gdp) in zimbabwe

Journal of Management and Science ◽

10.26524/jms.2014.15 ◽

2014 ◽

Vol 1 (3) ◽

pp. 156-162

Author(s):

Tendai Makoni

Keyword(s):

Time Series ◽

Gross Domestic Product ◽

Cointegration Test ◽

Domestic Product ◽

Long Run ◽

Causality Tests ◽

Granger Causality Tests ◽

Relationship Of ◽

The Relationship ◽

Yearly Data

The time series yearly data for Gross Domestic Product (GDP), inflation and unemployment from 1980 to 2012 was used in the study. First difference of the logged data became stationary as suggested by the time series plots. Johansen Maximum Likelihood Cointegration test indicated a long-run relationship among the variables. Granger Causality tests suggested unidirectional causality between inflation and GDP, implying that GDP is Granger caused by inflation in Zimbabwe. Another unidirectional causality was noted between unemployment and inflation. The causality between unemployment and inflation imply that unemployment do affect GDP indirectly since unemployment influences inflation which in turn positively affect GDP.

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Dynamic Relationship Between Energy and Economic Growth: Evidence from D8 Countries.

The Pakistan Development Review ◽

10.30541/v50i4iipp.437-458 ◽

2011 ◽

Vol 50 (4II) ◽

pp. 437-458 ◽

Cited By ~ 8

Author(s):

Sarwat Razzaqi ◽

Faiz Bilquees ◽

Saadia . Sherbaz

Keyword(s):

Economic Growth ◽

Granger Causality ◽

Energy Use ◽

Demand And Supply ◽

Dynamic Relationship ◽

Long Run ◽

Production And Consumption ◽

Short Run ◽

Oil Embargo ◽

The Relationship

Energy sector has a vital influence on an economy, on both demand and supply sides. Therefore, energy production and consumption bear great importance for the developing world. The oil embargo of 1970‘s and its impact on major macroeconomic variables throughout the world attracted many economists to examine the relationship between energy and economic prosperity. The researchers have been unable to establish a definitive direction of causality between the two variables. The purpose of this study is to empirically investigate the dynamic relationship between energy use and economic growth in the D8 countries. The evidence gathered through application of VAR Granger Causality, Johansen Cointegration and VECM proves existence of short-run and long-run correlation between energy use and economic development in all countries. The results supported either uni-directional or bi-directional causality in the D8 countries except for Indonesia in short-run where non-causality was established between the two variables. JEL classifications: C22; Q43. Keywords: Energy Use, Economic Growth, D8, VAR Granger Causality, Cointegration, VECM

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Controlling Money Supply And Price Level With Unknown Regime Shifts: The Case Of Chile

Journal of Applied Business Research (JABR) ◽

10.19030/jabr.v24i2.1360 ◽

2011 ◽

Vol 24 (2) ◽

Author(s):

Abdulnasser Hatemi-J ◽

Manuchehr Irandoust

Keyword(s):

Monetary Policy ◽

Steady State ◽

Money Supply ◽

Price Level ◽

Regime Shifts ◽

Font Size ◽

Long Run ◽

Causality Tests ◽

The Relationship ◽

Second Period

This paper investigates the relationship between money supply and price level using new tests for cointegration with two unknown regime shifts and bootstrap causality tests. Quarterly Chilean data from 1973: I to 2006: III is used. We find empirical evidence that the variables establish a long-run steady state relationship in the presence of two regime shifts. The elasticity of price level with regard to money supply is close to unity during the first period (prior to 1978: II). The elasticity is reduced during the second period (1978: III-1986: I) and it is also reduced for the remaining period but the reduction is smaller. We also conducted bootstrap causality tests that reveal the following: in the first sub-period there is bidirectional causality between the underlying variables. In the last two sub-periods money supply causes the price level only. This implies that money supply is weakly exogenous concerning the price level and that the monetary authority had enough independence to execute an active monetary policy in Chile.

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Financial development in Jordan: Where do remittances play a role in bank credit?

Accounting ◽

10.5267/j.ac.2021.4.028 ◽

2021 ◽

Vol 7 (7) ◽

pp. 1701-1708

Author(s):

Hadeel Yaseen ◽

Ghassan Omet

Keyword(s):

Private Sector ◽

Financial Development ◽

Bank Credit ◽

Research Issues ◽

Stable Relationship ◽

Long Run ◽

Time Period ◽

The Impact ◽

The Relationship ◽

Auto Regression

The Jordanian economy has been a recipient of huge amounts of remittances. Indeed, for more than a decade now, the inflow of this capital has been fluctuating around 10 percent of Gross Domestic Product (GDP). Within this context, the subject matter of remittances has resulted in the development of a myriad of research issues. One of these issues is the impact of remittances on financial development or bank credit to the private sector. This paper looks at the relationship between financial development and remittances in the Jordanian context. Based on the time period 1992-2019, and time series econometric techniques (co-integration and vector auto-regression, among others), this paper examines the impact of remittances on bank credit to the private sector, and on its main sectoral distributions. The estimated results reveal some interesting findings. There is no long-run stable relationship between bank credit to the private sector and remittances. However, there is a stable long-run relationship between credit to individuals (households) and remittances, and between credit to the construction sector and remittances. These conclusions imply that remittances, on average, promote private consumption in general, and residential spending.

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The Impact of Shadow Banking on Economic Growth: Evidence from Cross Country Data (2006–2018)

Journal of International Commerce Economics and Policy ◽

10.1142/s1793993320500106 ◽

2020 ◽

Vol 11 (03) ◽

pp. 2050010

Author(s):

Sheunesu Zhou ◽

D Tewari Dev

Keyword(s):

Economic Growth ◽

Positive Association ◽

Shadow Banking ◽

Stock Market Development ◽

Long Run ◽

Causality Tests ◽

The Impact ◽

The Relationship ◽

Regular Review

Shadow banking has become an important part of many financial systems despite having contributed to the financial crisis of 2008/2009. This study analyzes the relationship between shadow banking and economic growth using a panel of 28 developed and emerging economies. We employ panel feasible GLS technique and find a positive association between shadow banking and economic growth in the long-run. Further, we test for the Finance–Growth relationship using Granger causality tests and find a bi-directional relationship between shadow banking and economic growth. Stock market development and bank credit also have positive bi-directional relationships with economic growth. Our findings emphasize the role of financial innovation in enhancing economic performance given a stable regulatory environment. We suggest regular review of macro-prudential policy to carter for new financial activities and also to allow for development of new financing techniques.

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The Dynamic Relationship between Export, Import and Inflation: Empirical Evidence from India

The Indian Economic Journal ◽

10.1177/0019466220935552 ◽

2018 ◽

Vol 66 (3-4) ◽

pp. 294-311

Author(s):

Malayaranjan Sahoo ◽

Narayan Sethi

Keyword(s):

Impulse Response Function ◽

Decomposition Analysis ◽

Dynamic Relationship ◽

Long Run ◽

Integration Test ◽

Causality Tests ◽

Competitive Prices ◽

Variance Decomposition Analysis ◽

The Government ◽

The Relationship

This article aims to examine the relationship between inflation, export, import and foreign direct investment (FDI) in India from1975 to 2017. The study employed Johansen co-integration test to find out the long-run relationship among the variables and further variance decomposition analysis (VDA) and impulse response function (IRF) through vector autoregression (VAR) used to find out the dynamic relationship. Both VDA and IRF results indicate that export has positive or greater influence in inflation in India than other variables like import and FDI. The pair-wise granger causality approach finds that there is unidirectional causality running between exports and inflation and not vice versa, whereas inflation granger causes import. Toda Yamamoto causality also has shown similar result. Both the causality tests revealed that no causal relationships exist between inflation and FDI in India during the study period. As the exports of India have been continuously declining for past few years, the outcomes of this study are the true depiction of India’s economic situation. So, the government should provide a competitive environment and incentives to the local industry to produce at competitive prices to the international market.

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DECOMPOSITION OF ECONOMIC RELATIONSHIPS BY TIMESCALE USING WAVELETS

Macroeconomic Dynamics ◽

10.1017/s1365100598006038 ◽

1998 ◽

Vol 2 (1) ◽

pp. 49-71 ◽

Cited By ~ 163

Author(s):

James B. Ramsey ◽

Camille Lampart

Keyword(s):

Economic Time Series ◽

Economic Relationships ◽

Time Aggregation ◽

Long Run ◽

Causality Tests ◽

Relevant Variables ◽

Economic Time ◽

Granger Causality Tests ◽

Relationship Of ◽

The Relationship

Economists have long known that timescale matters in that the structure of decisions as to the relevant time horizon, degree of time aggregation, strength of relationship, and even the relevant variables differ by timescale. Unfortunately, until recently it was difficult to decompose economic time series into orthogonal timescale components except for the short or long run in which the former is dominated by noise. Wavelets are used to produce an orthogonal decomposition of some economic variables by timescale over six different timescales. The relationship of interest is that between money and income, i.e., velocity. We confirm that timescale decomposition is very important for analyzing economic relationships. The analysis indicates the importance of recognizing variations in phase between variables when investigating the relationships between them and throws considerable light on the conflicting results that have been obtained in the literature using Granger causality tests.

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The Relationship between Exports and Economic Growth in Saudi Arabia

Asian Social Science ◽

10.5539/ass.v12n4p117 ◽

2016 ◽

Vol 12 (4) ◽

pp. 117 ◽

Cited By ~ 1

Author(s):

Tarek Tawfik Yousef Alkhateeb ◽

Haider Mahmood ◽

Zafar Ahmad Sultan

Keyword(s):

Economic Growth ◽

Saudi Arabia ◽

Well Being ◽

Export Growth ◽

High Rate ◽

Long Run ◽

Causality Tests ◽

Policy Measures ◽

The Relationship ◽

Series Technique

One of the most important objectives of an economy is to achieve high rate of economic growth so as to improve the well-being of their citizen. For the purpose, export-oriented policy measures are more preferably prescribed in the recent past. The present study aims at to find the linkages between exports and economic growth in case of Saudi Arabia. The study uses the most efficient unit root, cointegration and causality tests to find the true relationships between exports and economic growth. The study tries to examine the dynamic association for exports and economic growth in Saudi Arabia. Applying more popular time series technique of long run relationship and causality, the paper finds the long-run cointegration relationships in our export-growth model. Further, we have found feed-back effect in export-growth relationships and suggest the further export-promotion to foster economic growth in Saudi Arabia.

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