Causality between trade openness and energy consumption: What causes what in high, middle and low income countries

Muhammad Shahbaz, Samia Nasreen, Chong Hui Ling and Rashid Sbia

ULB Institutional Repository from ULB -- Universite Libre de Bruxelles

Abstract: This paper explores the relationship between trade openness and energy consumption using data of 91 high, middle and low income countries. The study covers the period of 1980-2010. We have applied panel cointegration to examine long run relationship between the variables. The direction of causal relationship between trade openness is investigated by applying Homogenous non-causality, Homogenous causality and Heterogeneous causality tests.Our variables are integrated at I(1) confirmed by time series and panel unit root tests and cointegration is found between trade openness and energy consumption. The relationship between trade openness and energy consumption is inverted U-shaped in high income countries but U-shaped in middle and low income countries. The homogenous and non-homogenous causality analysis reveals the bidirectional causality between trade openness and energy consumption. This paper opens up new insights for policy makers to design a comprehensive economic, trade and policies for sustainable economic growth in long run following heterogeneous causality findings. 2014 Elsevier Ltd.

Keywords: Causality; Energy; Trade (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-ene and nep-int
Note: SCOPUS: ar.j
References: Add references at CitEc
Citations: View citations in EconPapers (85)

Published in: Energy policy (2014) v.70,p.126-143

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Causality between trade openness and energy consumption: What causes what in high, middle and low income countries (2014)
Journal Article: Causality between Trade Openness and Energy Consumption- What Causes What in High, Middle and Low Income Countries (2014)
Working Paper: Causality between Trade Openness and Energy Consumption: What Causes What in High, Middle and Low Income countries (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ulb:ulbeco:2013/168714

Ordering information: This working paper can be ordered from
http://hdl.handle.ne ... lb.ac.be:2013/168714

Access Statistics for this paper

More papers in ULB Institutional Repository from ULB -- Universite Libre de Bruxelles Contact information at EDIRC.
Bibliographic data for series maintained by Benoit Pauwels ().