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Culprits of Increased Non-Renewable Energy Consumption in Indonesia: Role of Inflation, Poverty and Debts

Author

Listed:
  • S. K. Purwanto

    (Widyatama University, Indonesia,)

  • Obsatar Sinaga

    (Padjadjaran University, Indonesia,)

  • Morni Hayati Jaafar Sidik

    (Universiti Kuala Lumpur, Malatysia.)

Abstract

Non-renewable resources, which include natural resources, are now being much rare and are being depleted in the recent decades as these are not being replenished naturally. In Indonesia, there is a need to see and manage the factors that utilize the maximum amount of non-renewable energy in the state. Thus, our study investigates the factors that characterize for the increased use of non-renewable resources that include inflation, poverty, debts, etc. This research has gathered data over 28 years of time to get a time-series analysis. The independent variables are inflation, poverty, and debts of the nation. The dependent variable is non-renewable energy consumption and the control variables are population growth and GDP of Indonesia. For this purpose, we have used Autoregressive distributed time lag (ARDL) model and Augmented Dickey Fuller (ADF) technique along with unit root tests. Further, the co-integrating among the variables is also tested for observing the relationship of variables in the long-run. The results show that all the inflation, poverty, and debts have significantly being the culprits for increased non-renewable energy consumption in both short-run and long-run analysis. However, population growth has been insignificant in the long run. The research gives useful directions for the policy-makers and people as how to reduce the increased rate of debts, inflation and poverty.

Suggested Citation

  • S. K. Purwanto & Obsatar Sinaga & Morni Hayati Jaafar Sidik, 2021. "Culprits of Increased Non-Renewable Energy Consumption in Indonesia: Role of Inflation, Poverty and Debts," International Journal of Energy Economics and Policy, Econjournals, vol. 11(6), pages 560-566.
  • Handle: RePEc:eco:journ2:2021-06-64
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    References listed on IDEAS

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    2. Bilgen, S., 2014. "Structure and environmental impact of global energy consumption," Renewable and Sustainable Energy Reviews, Elsevier, vol. 38(C), pages 890-902.
    3. Bor, Yunchang Jeffrey & Zhang, ZhongXiang, 2010. "Asian energy in the context of growing security and environmental concerns," Energy Economics, Elsevier, vol. 32(Supplemen), pages 1-2, September.
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    Cited by:

    1. Heru Wahyudi & Ukhti Ciptawaty & Arivina Ratih & Ahmad Dhea Pratama, 2023. "Comparison of Renewable and Non-Renewable Energy in the Long and Short Term of Indonesia Economy," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 194-201, September.

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    More about this item

    Keywords

    non-renewable energy consumption; inflation; poverty; debts; ARDL; Indonesia.;
    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
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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