The causal relationship between U.S. energy consumption and real output: A disaggregated analysis

Nicholas Bowden and James Payne

Journal of Policy Modeling, 2009, vol. 31, issue 2, 180-188

Abstract: This study utilizes U.S. annual data from 1949 to 2006 to examine the causal relationship between energy consumption and real GDP using aggregate and sectoral primary energy consumption measures within a multivariate framework. The Toda-Yamamoto long-run causality tests reveal that the relationship between energy consumption and real GDP is not uniform across sectors. Granger-causality is absent between total and transportation primary energy consumption and real GDP, respectively. Bidirectional Granger-causality is present between commercial and residential primary energy consumption and real GDP, respectively. Finally, the results indicate that industrial primary energy consumption Granger-causes real GDP. The results suggest that prudent energy and environmental policies should recognize the differences in the relationship between energy consumption and real GDP by sector.

Keywords: Energy; consumption; Real; GDP; Granger-causality (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (195)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:31:y:2009:i:2:p:180-188

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