Does more energy consumption support economic growth in net energy-importing countries?
Keywords:
Economic growth, Energy consumption, Panel data analysis, Net energy importersAbstract
Purpose. This study aims to examine the effects of energy consumption on economic growth by means of a panel data analysis of 75 net energy-importing countries for the period 1990 to 2012.
Design/methodology/approach. For the purpose of the analysis, the countries are classified into two groups, and each group is then classified into subgroups. The first group is formed based on the energy import dependence of the countries and is classified into two subgroups according to whether their dependence is greater than or less than 50 per cent. The second group is formed based on the income level of the countries and is classified into four subgroups, specifically, low-income economies, lower-middle-income economies, upper-middle-income economies and high-income economies.
Findings. The findings obtained for both panel data and for each country indicate that there is a positive and statistically significant relationship between energy consumption and economic growth over the long term such that energy consumption contributes more to economic growth as the import dependence of the country decreases. Moreover, the effect of energy consumption on economic growth decreases as the income level of the country increases. This indicates that the efficient use of energy is as important as energy consumption, which is regarded as an important indicator of economic development.
Originality/value. The authors expect that these findings will make a valuable contribution to the results of future studies, as they analyze the relationships among the variables by including the energy intensities of the countries.
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