The effect of renewable energy consumption on economic growth: Evidence from top 38 countries

By Madhumita Bhattacharya, S. Paramati, Ilhan Ozturk, Sankar Bhattacharya. 2016

1,362 citations recorded by the source corpus.

This research aims to investigate the effects of renewable energy consumption on the economic growth of major renewable energy consuming countries in the world. Using the Renewable Energy Country Attractiveness Index developed by the Ernst & Young Global Limited, we choose 38 top renewable energy consuming countries to explain the growth process between 1991 and 2012. With panel estimation techniques, our findings establish cross-sectional dependence and heterogeneity across the countries. We confirm the evidence of long-run dynamics between economic growth, and traditional and energy-related inputs. Findings from long-run output elasticities indicate that renewable energy consumption has a significant positive impact on the economic output for 57% of our selected countries. For robustness, we also carried out time-series analyses of long-run output elasticities. Our findings suggest that governments, energy planners, international cooperation agencies and associated bodies must act together in increasing renewable energy investment for low carbon growth in most of these economies.

Subfields: Economics and Econometrics, Pollution, Renewable Energy, Sustainability and the Environment

View Paper: https://www.semanticscholar.org/paper/05a7e51b93429cf104033b865dc9cf4896188f6d

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Citations in the corpus

Does renewable energy drive sustainable economic growth? multivariate panel data evidence for EU-28 countries. (2017, positive): “[44] supported the growth hypothesis forasmuch as within 57% of 38 top renewable energy consuming states over 1991–2012, renewable energy consumption exerted a positive impact on economic growth.”
The impact of urbanization on energy intensity: Panel data evidence considering cross-sectional dependence and heterogeneity (2017, background): “Hence the problems regarding the dynamic features of the data set are eliminated and more consistent empirical results are obtained [46].”
The impact of renewable energy consumption and environmental sustainability on economic growth in Africa (2021, background): “This finding is comparable to the argument put forward by Bhattacharya et al. (2016) that renewable energy consumption has a positive and significant effect on economic growth in the long run, sampling 38 renewable energy”
Renewable Energy and Economic Growth: Evidence from European Countries (2018, background): “In a similar publication, the effect of RESs on economic growth, including biomass, geothermal, wind and solar energyd and hydroelectricity is examined in 38 countries, which are classified into three groups [14].”
Renewable Energy Development as a Driver of Economic Growth: Evidence from Multivariate Panel Data Analysis (2019, methodology): “For instance, Bhattacharya et al [39] used the FMOLS model for a panel of 38 countries and showed that a 1% increase in renewable energy consumption lead to a 0.”