Natural Gas Consumption and Economic Growth in Pakistan: Production Function Approach

Muhammad Hassan (), Muhammad Naveed Tahir, Ayesha Wajid, Haider Mahmood () and Abdul Farooq

Global Business Review, 2018, vol. 19, issue 2, 297-310

Abstract: This study investigates the relationship between energy consumption and economic growth in case of Pakistan using annual data from 1977 to 2013. Using Johansen maximum likelihood approach to estimate the long-run relationship and Granger causality to check the direction of causality, the study finds that the long-run relationship between natural gas consumption and economic growth is positive and statistically significant. Furthermore, the Granger causality shows that there exists energy-led growth hypothesis in Pakistan as Granger causality runs from energy to economic growth. The policy implication is that uninterrupted availability of energy is essential and conservation strategies could be harmful for the economic growth.

Keywords: Pakistan; economic growth; natural gas consumption (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:globus:v:19:y:2018:i:2:p:297-310

DOI: 10.1177/0972150917713533

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