Relationships among energy consumption, pollution emission, and economic growth in Nepal

Umesh Bastola () and Pratikshya Sapkota

Energy, 2015, vol. 80, issue C, 254-262

Abstract: Solving the existing energy crisis, alleviating poverty, and mitigating the potential impacts of climate change have garnered significant attention of policy makers in Nepal. In this context, this paper examines the causal relationships among energy consumption, pollution emission, and economic growth for Nepal employing time series econometric methodology. Both Johansen cointegration and ARDL (Autoregressive Distributed Lag) bounds tests suggest presence of two cointegrating vectors, one when energy consumption and the other when carbon emissions are used as dependent variables. The Granger causality tests suggest presence of long-run bidirectional causality running from energy consumption to carbon emission and vice-versa and a unidirectional causality running from economic growth to both carbon emissions and energy consumption. These findings imply that policies that boost energy consumption may not spur economic growth, rather are more likely to exert adverse effects on the environment. On the other hand, energy conservation and carbon emission reduction policies would not impede the long-run economic growth. Policies that focus on alternative energy may be an approach in favor of mitigating climate change impacts while protecting environmental health and without a cost to the country's long-run economic growth.

Keywords: Energy consumption; CO2 emissions; Cointegration; Causality; Nepal (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (46)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0360544214013231
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:80:y:2015:i:c:p:254-262

DOI: 10.1016/j.energy.2014.11.068

Access Statistics for this article

Energy is currently edited by Henrik Lund and Mark J. Kaiser

More articles in Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().