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Renewable Energy Consumption-Economic Growth Nexus in G7 Countries: New Evidence from a Nonlinear ARDL Approach

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  • Shahbaz, Muhammad
  • Khraief, Naceur
  • L. Czudaj, Robert

Abstract

The paper investigates the nonlinear pass-through from economic growth to renewable energy consumptionby applying a Nonlinear Auto-Regressive Distributed Lag model (NARDL) for G7 countries. This study covers the period of 1995Q1-2015Q4. The recent approach allows for empirical tests of short-run and long-run asymmetric responses of renewable energy consumption to positive and negative shocks stemming from economic growth. The results reveal that renewable energy consumption responds asymmetrically to economic growth in the long-run for France, Japan, Italy and the UK. However, we find no evidence for a long-run equilibrium between renewable energy consumption and economic growth in Germany, Canada and the US.

Suggested Citation

  • Shahbaz, Muhammad & Khraief, Naceur & L. Czudaj, Robert, 2020. "Renewable Energy Consumption-Economic Growth Nexus in G7 Countries: New Evidence from a Nonlinear ARDL Approach," MPRA Paper 103525, University Library of Munich, Germany, revised 13 Oct 2020.
    • Handle: RePEc:pra:mprapa:103525
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    Cited by:

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    2. Clement Olalekan Olaniyi & James Temitope Dada & Nicholas Mbaya Odhiambo & Xuan Vinh Vo, 2023. "Modelling asymmetric structure in the finance-poverty nexus: empirical insights from an emerging market economy," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(1), pages 453-487, February.
    3. Khanday, Ishfaq Nazir & Tarique, Md., 2023. "Does income inequality respond asymmetrically to financial development? Evidence from India using asymmetric cointegration and causality tests," The Journal of Economic Asymmetries, Elsevier, vol. 28(C).
    4. Wang, Qiang & Wang, Lili & Li, Rongrong, 2023. "Could trade protectionism reshape the nexus of energy-economy-environment? Insight from different income groups," Resources Policy, Elsevier, vol. 85(PA).
    5. Miguel Á. Tinoco-Zermeño, 2023. "Energy consumption, financial development, CO2 emissions, and economic growth in 23 developing economies," Remef - Revista Mexicana de Economía y Finanzas Nueva Época REMEF (The Mexican Journal of Economics and Finance), Instituto Mexicano de Ejecutivos de Finanzas, IMEF, vol. 18(1), pages 1-24, Enero - M.

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    More about this item

    Keywords

    Renewable Energy Consumption; Economic Growth; Nonlinear ARDL;
    All these keywords.

    JEL classification:

    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation

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