Financial Development, Investment and Energy Consumption in Nigeria: ARDL Approach

Muhammad Shehu ()
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Muhammad Shehu: Federal Polytechnic

Acta Universitatis Danubius. OEconomica, 2019, issue 15(1), 151-162

Abstract: The study investigates the link between financial development, investment and energy consumption in Nigeria. The aim of the study is to re-examine financial development and energy consumption model by considering investment as a factor that contributes to more energy demand for consumption. The study employs an annual data within the period 1981 and 2015. The Autoregressive Distributed Lag (ARDL) Method is used to analyse the data. From the results, financial development had a negative impact on energy consumption both in the short-run and the long-run. Investment has a positive significant impact on energy consumption in the short-run, while it was significantly negative in the long-run. GDP in the long-run and short-run positively relates with energy consumption. Population growth rate in the short-run negative impact on energy consumption, while in the long-run was positive. The findings propel the conclusion that financial development and investment are an important determinant of energy consumption in Nigeria and government should consider a policy that incorporate credit availability on energy issues into its plan.

Keywords: Financial development; energy consumption; Investment; GDP; ARDL (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:dug:actaec:y:2019:i:1:p:151-162

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