Banking Sector Development and Energy Consumption in Nigeria: Exploring the Causal Relationship and its Implications
Tobechi F. Agbanike,
Uwazie I. Uwazie,
Lasbrey I. Anochiwa and
Michael O. Enyoghasim
African Development Review, 2019, vol. 31, issue 3, 292-306
This study examines the causal relationship between banking sector development and energy consumption in Nigeria over the period 1971–2013 incorporating crude oil price and indicators of economic performance. An autoregressive distributed lag bounds testing approach to cointegration provides evidence of long‐run relationship among the variables. The long‐run and short‐run estimates suggest that a non‐linear inverted U‐shaped relationship exists between banking sector development and energy consumption in Nigeria, indicating that initially, energy consumption increases as the banking sector develops and then declines as the banking sector matures to generate efficiency in energy consumption. In addition, this study explores the direction of causality between the variables using the Toda–Yamamoto Granger causality test procedure. The results suggest that a unidirectional causality runs from crude oil price to banking sector development, from banking sector development to energy consumption and from energy consumption to economic growth. It may therefore be necessary for policy makers in Nigeria to incorporate banking sector development in the energy and sustainable economic policies.
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:afrdev:v:31:y:2019:i:3:p:292-306
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1017-6772
Access Statistics for this article
African Development Review is currently edited by John C. Anyanwu, Hassan Aly and Kupukile Mlambo
More articles in African Development Review from African Development Bank Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().