CAUSAL INTERACTIONS BETWEEN FDI, ELECTRICITY CONSUMPTION AND ECONOMIC GROWTH: EVIDENCE FROM DYNAMIC PANEL CO-INTEGRATION MODELS

Mostefa Belmokaddem (), Yassine Zakaria Ghouali, Mohammed seghir Guellil () and Mohammed Abbes Sahraoui
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Yassine Zakaria Ghouali: Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria
Mohammed Abbes Sahraoui: Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria

Journal of Social and Economic Statistics, 2014, vol. 3, issue 2, 1-30

Abstract: In all countries, especially developing countries, foreign direct investment (FDI) plays a very important role, it is even considered as the engine of economic growth and development. Energy has always played a major role in human and economic development as well as in the well-being of society and modern societies are increasingly using more energy for industry, services, housing and transportation. This is particularly true for oil, which is now the most important traded commodity, but also for electricity, which is essential in contemporary economies characterized by the omnipresence of information technology, communication and digital. This study analyzes the relationship between foreign direct investment, electricity consumption and economic growth in 65 countries, using co-integration and Granger causality tests in panel data. The results show a disparity in terms of the relationship between the co-integration of the panel study. The results also indicate a unidirectional causality from FDI to GDP could be a good tool to prioritize the allocation of resources across sectors to promote foreign direct investment, and a bi-directional causality between the electric consumption and GDP for some panel

Keywords: Panel co-integration; Foreign Direct Investment; Electricity consumption; Economic growth; Fmols and Dols Estimators; Panel Granger causality (search for similar items in EconPapers)
JEL-codes: C00 C01 C2 C23 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:aes:jsesro:v:3:y:2014:i:2:p:1-30

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