Title: A sectoral approach to the energy consumption - economic growth nexus for select Asian countries

Authors: Karen Fernandes

Addresses: Centre for Excellence in Sustainable Development, Goa Institute of Management, Poriem Sattari, Goa 403505, India

Abstract: Adequate attention has not been paid to understanding the relationship between energy consumption and economic growth at a sectoral level. This study attempts to understand and analyse the relationship between sectoral energy consumption and economic growth for China, India, Indonesia, Malaysia, the Philippines and Thailand by employing techniques such as ARDL bound testing approach to cointegration and Toda Yamamoto causality test. Results suggests that for China and India, industrial energy consumption is cointegrated with economic growth and VECM indicates that it corrects itself after a deviation in the previous period by 31% and 46% resp. Agricultural energy consumption and economic growth are cointegrated for Indonesia and Thailand while variables are cointegrated in the service sector for the Philippines. Toda Yamamoto causality test for China, India, the Philippines and Thailand indicates that agricultural growth causes energy consumption while agricultural energy consumption causes growth in Indonesia and Thailand. Industrial growth causes energy use in India and Philippines while the reverse is in case of China. There exists a bi-directional causality in the service sector for India. In the Philippines, economic growth in the service sector causes energy use, while the reverse is true in Malaysia.

Keywords: energy use; value added; cointegration; causality; agricultural sector; industrial sector; residential sector; service sector.

DOI: 10.1504/IJEGN.2023.135297

International Journal of the Energy-Growth Nexus, 2023 Vol.1 No.1, pp.23 - 39

Received: 08 Sep 2022
Accepted: 17 Apr 2023
Published online: 04 Dec 2023 *