Ebere Ume Kalu, Pius Bala Daniel, Uchenna Florence Nwafor, Chinwe R. Okoyeuzu, Okoro E.U. Okoro and Elizabeth U. Okechukwu
The main aim of this study was to examine whether any relationship exists between energy consumption and value added of the agricultural and industrial sector as well as the…
Abstract
Purpose
The main aim of this study was to examine whether any relationship exists between energy consumption and value added of the agricultural and industrial sector as well as the overall growth rate of the Nigerian economy.
Design/methodology/approach
The study used annualized time series data from 1971 to 2014 drawn from the World Bank Development Indicators, adopting an autoregressive distributed lag technique in the data analyses as well as the bound test and error correction representation.
Findings
There is a very strong evidence of the existence of a long-run relationship between energy consumption and indicators of economic growth. There are very strong proofs that economic growth and agricultural value added adjust to the shocks and dynamics of the studied energy-consumption-related variables while manufacturing value added proved otherwise.
Originality value
No study to the best of our knowledge has brought together aggregate growth, agricultural value added and manufacturing value added in the investigation of the energy consumption and economic growth nexus in one study using the Nigerian stylized economic environment. This represents the value added of this study and shows its originality.
Details
Keywords
Florence Uchenna Nwafor, Ebere Ume Kalu, Augustine C. Arize and Josaphat U.J. Onwumere
This study aims to investigate in a country-specific comparative and panel form, the impact of energy use on financial development in Organisation of Petroleum Exporting Countries…
Abstract
Purpose
This study aims to investigate in a country-specific comparative and panel form, the impact of energy use on financial development in Organisation of Petroleum Exporting Countries (OPEC)-African countries of Algeria, Gabon, Libya and Nigeria.
Design/methodology/approach
With data sets covering the period 1980 to 2020, this study used a combination of country-specific autoregressive distributed lag model (ARDL) and panel-ARDL as well geo-maps to show the spatiotemporal nuances of the investigated countries.
Findings
It was discovered across the investigated countries and in the panel framework that energy consumption significantly impacts both bank development and institutional development, which are subsets of financial development. In addition, evidence in favor of adjustment of financial development to the shocks and dynamics of energy consumption was found.
Practical implications
Integrative developmental drive for the two sectors can enhance growth and value-chain interactions for the imperatives of the overall growth and development of the OPEC-African countries.
Originality/value
This study adds to the literature on finance and energy development by the introduction of the spatiotemporal analysis.
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Keywords
Ebere Ume Kalu, Uchenna Florence Nwafor, Chinwe R. Okoyeuzu and Vincent A. Onodugo
The purpose of this study is to investigate the energy–growth linkage in sub-Saharan Africa (SSA), with emphasis on real sectors’ contribution to aggregate growth using dynamic…
Abstract
Purpose
The purpose of this study is to investigate the energy–growth linkage in sub-Saharan Africa (SSA), with emphasis on real sectors’ contribution to aggregate growth using dynamic panel estimation techniques that are practically and conceptually superior to the static models.
Design/methodology/approach
Dynamic panel econometric techniques pooled mean group, mean group and dynamic fixed effect were used to investigate the linkage among energy consumption, real sector value added and economic growth from 1967 to 2016 in 48 SSA countries.
Findings
A strong empirical evidence in favor of energy dependence and growth hypothesis in the investigated SSA countries was found. The finding that real sector value added and overall growth rate adjust reasonably to the shocks and dynamics of the energy consumption variables makes energy consumption an enabler for growth. This indicates that well thought-out and implemented energy development policy will not only increase energy consumption but also elicit multi-sectoral growth while addressing the obvious energy deficiency in the SSA region.
Research limitations/implications
It is also important to note the policy implications of the high adjustment profiles indicated by the error correction representations. All the speeds of adjustment of the three models denominated in time are slightly above a year and are all within predictable limits (they fall below unity or 100%). We found that when agriculture value added, manufacturing value added and overall economic growth rate in our SSA panel estimation exceed equilibrium levels as a result of deviations arising from energy related variables, downward adjustments at 66%, 62% and 78% per year, respectively, take place.
Practical implications
The study indicates that well thought-out and implemented energy development policy will not only increase energy consumption but also elicit multi-sectoral growth while addressing the obvious energy deficiency in the SSA region.
Social implications
Much as this study has made some addition to the literature on energy-growth nexus in the SSA region, which undoubtedly is an unveiling of economic forces in a collection of developing and energy deficient economies, it will be of great research significance if the form and style of this study is adopted for other economic blocs in the shapes and sizes of the SSA region.
Originality/value
This study ensured currency of data, novelty of approach and disaggregated energy consumption into emerging sources, traditional sources and geographical access.