Empirical Research of the Relationship between Energy Consumption and Economic Growth in Beijing

Abstract:

This paper investigates the dynamic causal relationship between energy consumption and economic growth in Beijing over the period 1980-2012. The Johansen co-integration test, Granger causality test and the vector error correction model (VECM) are used to calculate the causal relationship between energy consumption and economic growth. The conclusion is that there exists a co-integration relationship between energy consumption and economic growth, and this relationship is a one way relationship from economic growth to energy consumption. Further, using VECM, the long-term and short-term elasticity from economy to energy consumption are 0.43 and 0.14 separately. Statistical analysis shows that, from 1980 to 2011, every 1% growth in GDP annually would drive energy consumption increasing rate by 0.43% correspondently.

• Periodical: Advanced Materials Research (Volumes 962-965)
• Pages: 2220-2224
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.962-965.2220
• Online since: June 2014
• Authors: Jie Yang
• Keywords: Co-Integration, Economic Growth, Energy Consumption (EC), Granger Causality, VECM

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