Renewable and Non-Renewable Energy Consumption and Its Impact on Economic Growth

Hosein Mohammadi (), Sayed Saghaian () and Bahareh Zandi Dareh Gharibi
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Hosein Mohammadi: Department of Agricultural Economics, College of Agriculture, Ferdowsi University of Mashhad, Mashhad 9177948978, Iran
Sayed Saghaian: Department of Agricultural Economics, College of Agriculture, Food and Environment, University of Kentucky, Lexington, KY 40536, USA
Bahareh Zandi Dareh Gharibi: Department of Agricultural Economics, College of Agriculture, Ferdowsi University of Mashhad, Mashhad 9177948978, Iran

Sustainability, 2023, vol. 15, issue 4, 1-13

Abstract: Energy is an important factor in boosting and sustaining the economic growth level of a country. The aim of this study was to investigate the relationship between energy consumption and the economic growth of selected developed and developing countries from 1993–2019. For this purpose, we used the Pedroni co-integration method to determine the long-term relationship between economic growth and energy consumption. To estimate the long-term parameters, the panel fully modified OLS method and the Dumitrescu and Hurlin heterogeneous panel causality estimation technique were used, and the causality direction between variables was considered. The results showed that energy consumption had a positive and significant effect on the economic growth of both groups of countries. The causality analysis revealed the existence of a protection effect between renewable energy consumption and economic growth in developed countries. Hence, policies that lead to an increase in independent growth in these countries can effectively impact their growth. On the other hand, the existence of the feedback effect in developing countries shows that storage policies and reduced energy consumption may pose a threat to economic growth in these countries.

Keywords: renewable energy consumption; non-renewable energy consumption; sustainability; economic growth (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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