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By applying an ARDL bounds testing approach and causality test to investigate the electricity consumption and production with economic growth

By applying an ARDL bounds testing approach and causality test to investigate the electricity... The purpose of this paper is to explore and investigate the electricity consumption and production and its linkage to economic growth in Pakistan.Design/methodology/approachThe authors used an augmented Dickey–Fuller unit root test to check the stationarity of the variables, while an autoregressive distributed lag (ARDL) bounds testing approach and causality test were applied to investigate the variables long-term association with the economic growth.FindingsThe study results show that electricity consumption in the agriculture, commercial and industrial sector has significant association with economic growth, while electricity consumption in the household and street lights demonstrate a non-significant association with the economic growth. Furthermore, results also exposed that electricity production from coal, hydroelectric, natural gas, nuclear and oil sources have significant association with the economic growth of Pakistan.Originality/valueThis study made a contribution to the literature regarding electricity consumption and production with economic growth in Pakistan by using an ARDL bounds testing approach and causality test. This study provides a guideline to the government of Pakistan that possible steps are needed to improve the electricity production and supply to fulfill the country demand. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png World Journal of Science, Technology and Sustainable Development Emerald Publishing

By applying an ARDL bounds testing approach and causality test to investigate the electricity consumption and production with economic growth

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2042-5945
DOI
10.1108/wjstsd-08-2019-0054
Publisher site
See Article on Publisher Site

Abstract

The purpose of this paper is to explore and investigate the electricity consumption and production and its linkage to economic growth in Pakistan.Design/methodology/approachThe authors used an augmented Dickey–Fuller unit root test to check the stationarity of the variables, while an autoregressive distributed lag (ARDL) bounds testing approach and causality test were applied to investigate the variables long-term association with the economic growth.FindingsThe study results show that electricity consumption in the agriculture, commercial and industrial sector has significant association with economic growth, while electricity consumption in the household and street lights demonstrate a non-significant association with the economic growth. Furthermore, results also exposed that electricity production from coal, hydroelectric, natural gas, nuclear and oil sources have significant association with the economic growth of Pakistan.Originality/valueThis study made a contribution to the literature regarding electricity consumption and production with economic growth in Pakistan by using an ARDL bounds testing approach and causality test. This study provides a guideline to the government of Pakistan that possible steps are needed to improve the electricity production and supply to fulfill the country demand.

Journal

World Journal of Science, Technology and Sustainable DevelopmentEmerald Publishing

Published: Apr 21, 2020

Keywords: Pakistan; Economic growth; Electricity consumption; Electricity production; Industrial sector; Nuclear sources

References