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The role of investment in energy and industry value added in the presence of financial resources in fostering sustainable economic growth of China

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  • Abraham Deka

    (Near East University)

Abstract

Energy has been depicted as an important factor of production, following the empirical results of recent researches. Therefore, energy resources should be promoted through investing more financial resources to produce more energy; hence, stimulate economic growth. This research investigates the influence of investment in energy and industry value added, in the presence of financial resources on the economic growth. There is no sufficient literature addressing this association, despite its significance in formulating key policies that promote economic growth. The data of China for the period 1990 to 2022 is used to address this problem. The Autoregressive Distributive Lag method is used to analyze this relationship because of its ability to produce robust results in short time series. The Granger causality test is also employed. The results obtained presents that capital raises the economic growth of China. Investment in energy and industry value added give insignificant, but positive influence on economic growth. This shows the importance of investment in energy and industry value added in stimulating economic growth, though a significant improvement on these factors is required to stimulate economic growth. I also show that financial resources and labor-force participation rate are counter-productive in fostering growth in China. The policy recommendations presented calls for the advancement in investment in energy and industry value added.

Suggested Citation

  • Abraham Deka, 2024. "The role of investment in energy and industry value added in the presence of financial resources in fostering sustainable economic growth of China," SN Business & Economics, Springer, vol. 4(9), pages 1-18, September.
    • Handle: RePEc:spr:snbeco:v:4:y:2024:i:9:d:10.1007_s43546-024-00711-9
    DOI: 10.1007/s43546-024-00711-9
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