Electricity Consumption and Information and Communication Technology in the Next Eleven Emerging Economies

Munshi Naser Ibne Afzal, Munshi Naser Ibne Afzal, Jeff Gow and Jeff Gow
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Munshi Naser Ibne Afzal: Department of Economics, Shahjalal University of Science & Technology, Sylhet, Bangladesh,
Munshi Naser Ibne Afzal: School of Commerce, University of Southern Queensland, Toowoomba, Australia
Jeff Gow: School of Commerce, University of Southern Queensland, Toowoomba, Australia
Jeff Gow: Department of Agricultural Economics, Stellenbosch University, Stellenbosch, South Africa
Authors registered in the RePEc Author Service: Jeff Gow

International Journal of Energy Economics and Policy, 2016, vol. 6, issue 3, 381-388

Abstract: In this study, the impact of information communication technologies (ICT) on electricity consumption in the next eleven (N-11) emerging economies over the period 1990-2014 is examined. This period coincides with high economic growth rates in those countries and associated rapidly increasing electricity consumption as well as the ICT revolution that saw the rapid uptake of new ICT by its peoples. Little has been published on the relationship between ICT and electricity consumption in the N-11 emerging economies. This paper examines the hypothesis that increased use of ICT increases electricity consumption. Secondly, how different measures of ICT affect electricity consumption and finally, what are the short-run and long run elasticities of electricity demand with respect to ICT in N-11 countries? The methods used included dynamic panel data models (mean group [MG], pool mean group [PMG], system generalized methods of moments) and show a positive and statistically significant relationship between ICT and electricity consumption where ICT is measured using internet connections, mobile phones or the import percentage of ICT goods of total imports. Long run ICT elasticities are smaller than income elasticities but because ICT growth rates are so much higher than economic growth rates, the impact of ICT on electricity consumption is greater than the impact of income on electricity consumption. Electricity demand projections in emerging economies, which do not include ICT as an explanatory variable, may underestimate actual electricity demand. This can lead to unplanned electricity shortages if actual electricity demand exceeds planned electricity demand. Thus, the paper gives policy recommendations based on the empirical results for the N-11 countries to address this problem

Keywords: Next Eleven Countries; ICT; Electricity Consumption; Panel Data; Mean Group Estimation; Pool Mean Group Estimation; System Gneralized Methods of Moments (search for similar items in EconPapers)
JEL-codes: J21 L94 N17 O1 O10 Q43 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2016-03-3

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