Renewable energy supply and economic growth in Malaysia: an application of bounds testing and causality analysis

Ahmed Sulub, Yasin and Hamid, Zarinah and Mior Nazri, Mior Nasir (2020) Renewable energy supply and economic growth in Malaysia: an application of bounds testing and causality analysis. International Journal of Energy Economics and Policy, 10 (3). pp. 255-264. ISSN 2146-4553

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Abstract

Empirical researches on the nexus between renewable energy supply and economic growth have been neglected. To address this gap, this study aims to examine the relationship between hydropower energy supply (HES) and economic growth within a multivariate model for the 1978-2017 period. This study utilized the auto regressive distributive lag (ARDL) bounds approach to testing for cointegration relationship; and the Granger causality test, based on the vector error correction model (VECM) to test for causality. The bounds F-test for cointegration shows that HES, electricity consumption, capital formation and GDP growth share a long-run relationship. Results show that HES has a significant positive impact on economic growth in the short-run. The causality tests yield evidence of unidirectional long-run and short-run causality running from economic growth to HES, suggesting that economic growth is necessary for providing the essential resources for fostering the HES. The existence of cointegration among HES and GDP growth infers that HES will not drift too far away from economic growth in the long-run. Thus, the government needs to ensure a sufficient supply of hydropower energy in the short-run and the long-run.

Item Type:	Article (Journal)
Additional Information:	728/79706
Uncontrolled Keywords:	Renewable Energy Supply, Hydropower Supply, Economic Growth, Malaysia
Subjects:	H Social Sciences > HD Industries. Land use. Labor > HD72 Economic growth, development, planning T Technology > TD Environmental technology. Sanitary engineering > TD169 Environmental protection T Technology > TD Environmental technology. Sanitary engineering > TD201 Water supply for domestic and industrial purposes
Kulliyyahs/Centres/Divisions/Institutes (Can select more than one option. Press CONTROL button):	Kulliyyah of Economics and Management Sciences > Department of Economics Kulliyyah of Economics and Management Sciences Kulliyyah of Information and Communication Technology Kulliyyah of Information and Communication Technology
Depositing User:	Dr. Zarinah Hamid
Date Deposited:	20 May 2020 13:05
Last Modified:	20 May 2020 13:05
URI:	http://irep.iium.edu.my/id/eprint/79706

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