Economic growth, electricity consumption and foreign dependence in Italy between 1963 and 2007

Vecchione, Gaetano (2010): Economic growth, electricity consumption and foreign dependence in Italy between 1963 and 2007.

Abstract

The energy sector is assuming an increasing importance in the global economy. As a consequence, there is a vast literature on the causal relation between energy use and others economic variables. In this paper, I investigate the relationship between electricity consumption and economic growth for Italy using yearly data covering the period 1963–2007. Unlike previous works, this paper specifically concerns the causal link between the dynamics of GDP and the different sources of electricity production. Regarding the dependence from foreign suppliers, the paper tests the hypothesis of a causal relationship between economic growth and electricity imports. The results show a unidirectional causality from economic activity to other variables. More specifically, economic growth Granger cause total electricity consumption, industrial consumption and electricity import. For the others source of generation, any specific causal relationship has been found.

• Item Type: MPRA Paper
• Language: English
• Keywords: : Energy and Growth, Italy, Vector Error Correction Model, Granger Causality
• Subjects: C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q48 - Government Policy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q40 - General

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