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Is there any relationship between energy and TFP (total factor productivity)? A panel cointegration approach for Italian regions

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  • Ladu, Maria Gabriela
  • Meleddu, Marta

Abstract

The aim of this work is to examine the long run relationship between TFP (total factor productivity) and energy consumption in Italy from 1996 to 2008 at a regional level. Differently from previous studies, TFP is employed as a measure of economic growth and therefore of technological change. Dynamic Panel estimation technique is used to investigate whether a connection between TFP and energy use exists and its direction. Results show a bi-directional causality for the Italian regions implying that those regions characterized by a higher TFP would invest more in research rather than in energy intensive activities, improving in that way the use of scarce resources and favoring a sustainable growth.

Suggested Citation

  • Ladu, Maria Gabriela & Meleddu, Marta, 2014. "Is there any relationship between energy and TFP (total factor productivity)? A panel cointegration approach for Italian regions," Energy, Elsevier, vol. 75(C), pages 560-567.
    • Handle: RePEc:eee:energy:v:75:y:2014:i:c:p:560-567
    DOI: 10.1016/j.energy.2014.08.018
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