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Positive and negative impacts of natural gas consumption on economic growth in Nigeria: a nonlinear ARDL approach

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  • Mukhtar Danladi Galadima
  • Abubakar Wambai Aminu

Abstract

The paper has examined positive and negative effects of natural gas on economic growth in Nigeria using nonlinear autoregressive distributed lag (NARDL) model. The findings revealed that the negative and positive impacts of natural gas consumption on economic growth are asymmetric in the long run whereas in the short run such evidence has not been found. However, in the long run, the positive impact is 0.15% per 1% increase while the negative impact is insignificant. The implication of the results is that an increase in natural gas consumption can stimulate growth in the long run and, energy efficiency/energy saving policies is not a limiting factor to growth, thus, it does not engender a fall in the rate of economic growth. Therefore, the paper recommends that authorities of the Nigeria's economy boost the domestic demand for natural gas and chart out energy efficiency strategies such as using a light-emitting diode (LED) light bulb or a compact florescent light (CFL) bulb that requires less energy than an incandescent light bulb and water booster heaters. This way, sustainable economic growth, curbing the issue of global warming and, minimising costs of energy consumption can be achieved.

Suggested Citation

  • Mukhtar Danladi Galadima & Abubakar Wambai Aminu, 2019. "Positive and negative impacts of natural gas consumption on economic growth in Nigeria: a nonlinear ARDL approach," African Journal of Economic and Sustainable Development, Inderscience Enterprises Ltd, vol. 7(2), pages 138-160.
    • Handle: RePEc:ids:ajesde:v:7:y:2019:i:2:p:138-160
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    Cited by:

    1. Al Amin Biswas & A. H. M. Shahriar & Mohammad Jahangir Alam & Ruhul Kuddus & Uttam Golder & Mita Rani Paul, 2023. "Rethinking FDI Policy in Bangladesh: An Asymmetric Approach to Globalization, Population, and Trade," International Journal of Economics and Financial Issues, Econjournals, vol. 13(6), pages 168-176, November.
    2. Byaro, Mwoya & Msafiri, Derick, 2021. "The uncertainty of natural gas consumption in Tanzania to support economic development. Evidence from Bayesian estimates," African Journal of Economic Review, African Journal of Economic Review, vol. 9(4), September.
    3. Ogali, Oscar I.O. & Okoro, Emeka E. & Olafuyi, Saburi G., 2023. "Assessing consensus on nexus between natural gas consumption and economic growth," Renewable and Sustainable Energy Reviews, Elsevier, vol. 187(C).

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