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Analysis of the Relationship between Energy Consumption, Foreign Direct Investment, and Labor Force Participation by Vector Error Correction Model: The Case of Kazakhstan

Author

Listed:
  • Aina B. Aidarova

    (Mukhtar Auezov South Kazakhstan University, Shymkent, Kazakhstan)

  • Gulshat Abdimutalipovna Zhadigerova

    (Central Asian Innovation University, Shymkent, Kazakhstan)

  • Ainur Abilkassym

    (Shymkent University, Shymkent, Kazakhstan)

  • Lyailya Abdybayevna Baibulekova

    (Kenzhegali Sagadiyev University of International Business, Almaty, Kazakhstan)

  • Dina B. Balabekova

    (Central Asian Innovation University, Shymkent, Kazakhstan)

  • Saule A. Ilasheva

    (Mukhtar Auezov South Kazakhstan University, Shymkent, Kazakhstan)

Abstract

This study examines the relationship between energy consumption, foreign direct investment, and labor force participation rate in Kazakhstan for the 1991-2021 period. Data on energy consumption are retrieved from the enerdata website, and data on foreign direct investment and labor force participation rate from the World Bank website. The Vector Error Correction Model (VCEM) method was used for data analysis. Research findings have shown that foreign direct investments have an effect on energy consumption for Kazakhstan both in the long run and the short run. The study found that although the labor force participation rate has an effect on energy consumption in the short term, it has no effect in the long term. These results are also important in terms of indirectly showing the long-term effects of foreign direct investments on the economy. The study used annual series for all three variables. Another important subject of study for explaining this relationship may be the use of series in different periods (especially quarterly).

Suggested Citation

  • Aina B. Aidarova & Gulshat Abdimutalipovna Zhadigerova & Ainur Abilkassym & Lyailya Abdybayevna Baibulekova & Dina B. Balabekova & Saule A. Ilasheva, 2023. "Analysis of the Relationship between Energy Consumption, Foreign Direct Investment, and Labor Force Participation by Vector Error Correction Model: The Case of Kazakhstan," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 108-114, September.
    • Handle: RePEc:eco:journ2:2023-05-13
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    References listed on IDEAS

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    3. Heru Wahyudi & Widia Anggi Palupi, 2023. "Relationship between Energy Consumption, Foreign Direct Investment, and Labor Force Participation Using the VECM Model: Empirical Study in OECD Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 13(2), pages 157-165, March.
    4. Baltaim Sabenova & Indira Baubekova & Gulmira Issayeva & Zarema Bigeldiyeva & Artur Bolganbayev, 2023. "Comparative Analysis of Volatility Structures of Stock Index and Energy Company Returns in Kazakhstan," International Journal of Energy Economics and Policy, Econjournals, vol. 13(2), pages 200-206, March.
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    More about this item

    Keywords

    Kazakhstan; Energy Consumption; Foreign Direct Investment; Labor Force Participation Rate;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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