Disaggregate Energy Consumption, Agricultural Output and Economic Growth in Pakistan

Muhammad Zahir Faridi () and Ghulam Murtaza ()

The Pakistan Development Review, 2013, vol. 52, issue 4, 493-516

Abstract: The basic goal of the study is to analyse the impact of energy consumption (i.e., electricity, oil and gas) on economic growth and agriculture sector output in Pakistan. It is desirable to find out relationship between disaggregate energy consumption, economic growth and agricultural sector output of Pakistan because energy crisis has become a central issue now-a-days. Production sector of Pakistan relies on electricity and gas consumption to large extent and these sources of energy are falling short because of many reasons which is disrupting output and consequently exports and real output of the country. To analyse the relationship, we employed time series data from 1972 to 2011. In order to find out long run and short run effects of energy consumption on agricultural output and economic growth, ARDL modelling approach to cointegration is applied after scrutinising the stationarity of data through ADF Test. Where, bound testing procedure is utilised for cointegration to judge the existence of long run relationship among variables and ECM models are formulated for short run analysis. Our econometric models include agricultural output and economic growth as dependant variables and electricity, coal and gas consumption as independent and core variables. The findings of the study indicate that gas and oil consumption are important determinants of economic growth and agricultural output.

Keywords: Disaggregate Energy Consumption; Agricultural Output; Economic Growth; ARDL; Co-integration; Pakistan (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (10)

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