Modeling natural gas consumption, capital formation, globalization, CO2 emissions and economic growth nexus in Malaysia: Fresh evidence from combined cointegration and causality analysis

Etokakpan, Mfonobong Udom; Solarin, Sakiru Adebola; Yorucu, Vedat; Bekun, Festus Vıctor; Sarkodıe, Samuel Asumadu

doi:10.1016/j.esr.2020.100526

Cited by 119 publications

(67 citation statements)

References 56 publications

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“…The author concluded that the impact of gross capital formation differs based on the country's income level. Etokakpan et al (2020) examined the association between gross capital accumulation and GDP in Malaysia covering the period 1980-2014, employing the Bayer and Hanck cointegration tests, ARDL, and Granger causality. The authors concluded that an increase in gross capital formation would increase GDP.…”

Section: Empirical Reviewmentioning

confidence: 99%

Can CO2 emissions and energy consumption determine the economic performance of South Korea? A time series analysis

Adebayo

Awosusi

Kırıkkaleli

et al. 2021

Environ Sci Pollut Res

128

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Following the United Nations Sustainable Development Goals (UN-SDGs), which place emphasis on relevant concerns that encompass access to energy (SDG-7) and sustainable development (SDG-8), this research intends to reexamine the relationship between urbanization, CO 2 emissions, gross capital formation, energy use, and economic growth in South Korea, which has not yet been assessed using recent econometric techniques, based on data covering the period between 1965 and 2019. The present study utilized the autoregressive distributed lag (ARDL), dynamic ordinary least square (DOLS), and fully modified ordinary least squares (FMOLS) methods, while the gradual shift and wavelet coherence techniques are utilized to determine the direction of the causality. The ARDL bounds test reveals a long-run linkage between the variables of interest. Empirical evidence shows that CO 2 emissions trigger economic growth. Thus, based on increasing environmental awareness across the globe, it is necessary to change the energy mix in South Korea to renewables to enable the use of sustainable energy sources and establish an environmentally sustainable ecosystem. Moreover, the energy-induced growth hypothesis is validated. This result is supported by the causality analysis, which shows a one-way causality running from energy consumption to GDP in South Korea. This suggests that South Korea cannot embark on conservative energy policies, as such actions will damage economic progress. Additionally, a unidirectional causality is seen from CO 2 emissions and energy consumption to economic growth. These findings have far-reaching consequences for GDP growth and macroeconomic indicators in South Korea.

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Section: Empirical Reviewmentioning

confidence: 99%

Can CO2 emissions and energy consumption determine the economic performance of South Korea? A time series analysis

Adebayo

Awosusi

Kırıkkaleli

et al. 2021

Environ Sci Pollut Res

128

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“…The intersection among capital formation, economic growth, and the EFP Capital formation is considered the backbone of any country's growth and development, but the recent literature has not extensively discussed these relationships. Using the ARDL and an error correction model (ECM), Bal et al (2016) found a significant positive relationship between capital formation and economic growth in India from 1970 to 2012, while Udom et al (2020) demonstrated a positive association between capital formation and economic growth in Malaysia from 1980 to 2014. The same positive relationship between capital formation and economic growth was the conclusion of the studies by Adebola and Shahbaz (2015) and Topcu et al (2020).…”

Section: Literature Reviewmentioning

confidence: 99%

The dynamic links among energy consumption, tourism growth, and the ecological footprint: the role of environmental quality in 38 IEA countries

Khan

Hou

2020

Environ Sci Pollut Res

181

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We examine the impact of energy consumption and tourism growth on the ecological footprints and economic growth of 38 International Energy Agency (IEA) countries, as moderated by labor and capital, over the 1995-2018 period. We develop a comprehensive empirical analysis that applies second-generation unit root and cross-section dependence analysis. The cointegration analysis indicates long-run relationships among the variables, while the fully modified least square (FMOLS) approach specifies that energy consumption promotes economic growth and degrades environmental quality in the long run, and tourism growth improves environmental quality and stimulates economic growth in the long run. In addition, the result of a pairwise Granger causality test reveals bidirectional causality between energy consumption and economic growth and unidirectional causality from the ecological footprint to energy consumption. Policy implications for theory and practice and directions for future research in the area are presented.

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“…Regarding the studies for the Southeast Asian countries, surprisingly, a small number of studies have been conducted in this multivariate framework (that combined CO 2 into energy-growth model). Some works have been conducted for the individual countries such as Ang [72] for Malaysia, Etokakpan et al [73] for Malaysia (Natural gas), Jafari et al [74], Hwang and Yoo [75], and Odugbesan and Rjoub [76] for Indonesia. A few works have been conducted as a group of Association of Southeast Asian Nations (ASEAN).…”

Section: Literature Reviewmentioning

confidence: 99%

Dynamic Modelling of Causal Relationship between Energy Consumption, CO2 Emission, and Economic Growth in SE Asian Countries

Chontanawat

2020

Energies

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Southeast Asian region is fast growing in terms of economy with rapid population growth, high energy consumption, and pollution. Understanding these linkages are crucial to guidance of appropriate policy. This study aims to examine the causal relationship between energy consumption with economic growth and CO2 emissions of the four selected Asian countries, namely Indonesia, Malaysia, Philippines, and Thailand between the years 1971–2017 using Johansen cointegration method combined with Granger causality model. The results found the evidence of cointegration in all countries implying a long-run relationship among energy consumption, economy and pollution exists. The causality main results show the evidence of unidirectional causality running from economic growth to energy consumption in Indonesia, Malaysia, and Thailand, while the opposite direction was found in Philippines. The results of Indonesia, Malaysia, and Thailand support “conservative hypothesis” suggesting that energy conservation policies could be adopted in these countries as it would not constrain growth of the economies. Whereas the results of Philippines appear to support “growth hypothesis” implying that energy is a key driver to stimulate economy. Limiting the use of energy could affect the economy. Instead, the policies, therefore, should focus on promoting other alternative energy source such as renewable energy in order to maintain sustainable growth.

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Modeling natural gas consumption, capital formation, globalization, CO2 emissions and economic growth nexus in Malaysia: Fresh evidence from combined cointegration and causality analysis

Cited by 119 publications

References 56 publications

Can CO2 emissions and energy consumption determine the economic performance of South Korea? A time series analysis

Can CO2 emissions and energy consumption determine the economic performance of South Korea? A time series analysis

The dynamic links among energy consumption, tourism growth, and the ecological footprint: the role of environmental quality in 38 IEA countries

Dynamic Modelling of Causal Relationship between Energy Consumption, CO2 Emission, and Economic Growth in SE Asian Countries

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