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The Relationship between Energy Consumption, Economic Growth and Carbon Dioxide Emission: The Case of South Africa

Hlalefang Khobai and Pierre Le Roux
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Pierre Le Roux: Department of Economics, Nelson Mandela Metropolitan University, South Africa

International Journal of Energy Economics and Policy, 2017, vol. 7, issue 3, 102-109

Abstract: This paper investigates the relationship between energy consumption, carbon dioxide (CO2 ) emission, economic growth, trade openness and urbanization for South Africa. The annual data for the period between 1971 and 2013 is employed. The results of Johansen test of co-integration show that there is a long run relationship between energy consumption, CO2 emission, economic growth, trade openness and urbanization in South Africa. The results for the existence and direction of vector error correction model (VECM) Granger causality indicates that there is bidirectional causality flowing between energy consumption and economic growth in the long run. The VECM results further found a unidirectional causality flowing from CO2 emissions, economic growth, trade openness and urbanization to energy consumption and from energy consumption, CO2 emissions, trade openness and urbanization to economic growth. These results posit a fresh perspective for creating energy policies that will boost economic growth in South Africa.

Keywords: Energy Consumption; Economic Growth; Carbon Dioxide Emission; South Africa (search for similar items in EconPapers)
JEL-codes: O13 Q43 (search for similar items in EconPapers)
Date: 2017
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