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Relationship between Energy Consumption and Real Gross Domestic Production in Turkey: A Co-integration Analysis with Structural Breaks

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  • A. znur mit

    (Department of Economics, Ondokuz May s University, Faculty of Economics and Administrative Sciences, Turkey.)

  • Elif Bulut

    (Department of Business, Ondokuz May s University, Faculty of Economics and Administrative Sciences, Turkey)

Abstract

Energy is one of the most fundamental requirements for a sustainable economy in many of the emerging countries. Being one of these emerging countries, Turkey has inadequate energy sources and this increases its foreign source dependency for energy. Likewise, experiencing negative energy shocks decreases the economic growth rate. Analyzing the relationship between energy consumption and economic growth by taking into account the structural changes caused by internal shocks and external shocks experienced in the country is of great importance for the Turkish economy. In this study, the long term relationship between energy consumption and real gross domestic production in the period between 1960 and 2012 has been investigated by employing co-integration methods and the vector error correction model. Results of our study show that there is a long term relationship between the series and one-way causality from real gross domestic production to energy consumption. These findings clearly state that economic growth has an important role in energy consumption.

Suggested Citation

  • A. znur mit & Elif Bulut, 2015. "Relationship between Energy Consumption and Real Gross Domestic Production in Turkey: A Co-integration Analysis with Structural Breaks," International Journal of Energy Economics and Policy, Econjournals, vol. 5(4), pages 968-978.
    • Handle: RePEc:eco:journ2:2015-04-08
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    References listed on IDEAS

    as
    1. Ali Acaravci & Ilhan Ozturk, 2012. "Electricity Consumption and Economic Growth Nexus: A Multivariate Analysis for Turkey," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 14(31), pages 246-257, February.
    2. Dipa Adhikari & Yanying Chen, 2013. "Energy Consumption and Economic Growth: A Panel Cointegration Analysis for Developing Countries," Review of Economics & Finance, Better Advances Press, Canada, vol. 3, pages 68-80, May.
    3. Mehdi Abid & Maamar Sebri, 2012. "Energy Consumption-Economic Growth Nexus: Does the Level of Aggregation Matter?," International Journal of Energy Economics and Policy, Econjournals, vol. 2(2), pages 55-62.
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    Cited by:

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    2. R. Abdul Maqin & Iwan Sidharta, 2017. "The Relationship of Economic Growth with Human Development and Electr c ty Consumpt on in Indonesia," International Journal of Energy Economics and Policy, Econjournals, vol. 7(3), pages 201-207.
    3. Hongyun, Han & Radwan, Amira, 2021. "Economic and social structure and electricity consumption in Egypt," Energy, Elsevier, vol. 231(C).

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    More about this item

    Keywords

    Energy Consumption; Economic Growth; Co-integration Test with Multiple Structural Breaks;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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