Short run and long run dynamics of residential electricity consumption: Homogeneous and heterogeneous panel estimations for OECD

Faik Bilgili, Yalçın Pamuk and Nadide Sevil Halıcı Tülüce

MPRA Paper from University Library of Munich, Germany

Abstract: The purpose of this paper is to reveal the short run and long run dynamics of residential electricity consumption for 11 OECD countries within annual period 1979-2006. To this end, this paper first explores the findings from related literature evidence and, later, follows panel cointegration equations (CEs) and panel error correction models (ECMs). CEs give long run relations of the variables in residential electricity demand function. ECMs include both long run and short run parameter estimates of the per capita residential electricity demand in terms of residential electricity price, residential light fuel oil price, residential natural gas price and per capita income. For both ECs and ECMs, the techniques of panel OLS, panel adjusted OLS and panel dynamic OLS are utilized. Finally, this paper yields short term and long term elasticities of residential electricity consumption together with error correction terms through homogeneous and heterogeneous variance structures.

Keywords: electricity consumption; elasticities; homogeneous and heterogeneous variance structures; panel error correction model; panel dynamic ordinary least squares (search for similar items in EconPapers)
JEL-codes: C33 C51 D12 Q43 (search for similar items in EconPapers)
Date: 2010-11, Revised 2011-06
New Economics Papers: this item is included in nep-ene
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Citations: View citations in EconPapers (2)

Published in Economic Computation and Economic Cybernetics Studies and Research 3/2011 (2011): pp. 113-126

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