Does energy efficiency promote economic growth? Evidence from a multicountry and multisectoral panel dataset

By A. Rajbhandari, Fan Zhang. 2018

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We examine the causal relationship between energy efficiency and economic growth based on panel data for 56 high- and middle-income economies from 1978 to 2012. Using a panel vector autoregression approach, we find evidence of a long-run Granger causality from economic growth to lower energy intensity for all economies. We also find evidence of long-run bidirectional causality between lower energy intensity and higher economic growth for middle-income economies. This finding suggests that beyond climate benefits, middle-income economies may also earn an extra growth dividend from energy efficiency measures.

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

View Paper: https://www.semanticscholar.org/paper/f79ea7310db9b1ca16624743f4ce8ac5dbc85762