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Energy and Economic Poverty: An Assessment by Studying the Causality Between Energy Consumption and Economic Growth in the Economic Community of West Africa States (ECOWAS)

30 Pages Posted: 20 Mar 2011  

Ouedraogo Nadia

Université Paris Dauphine

Date Written: March 19, 2011

Abstract

The increasing attention given to global energy issues and the international policies needed to reduce greenhouse gas emissions have given a renewed stimulus to research interest in the linkages between the energy sector and economic performance at country level. Economic poverty is linked with energy poverty and, at the same time, energy is an important vector for triggering economic development and for reaching the objectives of the Millennium Development Goals (MDGs).

In this paper we attempted to find the direction of the causal relationship between energy consumption and economic activity in the ECOWAS. More specifically we investigated the long run relationship and causality between energy consumption, oil price, and economic growth of the ECOWAS using the co-integration test of Johansen et al. (2004) and VECM causality test of Granger (1987).

Additionally, to explore the possibility of further information on the direction of causality we disaggregated energy consumption into its components of petroleum and electricity consumption.

Keywords: Energy Consumption, Energy Poverty, World Oil Prices, Economic Growth, Climate Change, Co-integration, Vector Error Correction Model (VECM), Granger Causality

Suggested Citation

Nadia, Ouedraogo, Energy and Economic Poverty: An Assessment by Studying the Causality Between Energy Consumption and Economic Growth in the Economic Community of West Africa States (ECOWAS) (March 19, 2011). USAEE Working Paper No. 11-072. Available at SSRN: https://ssrn.com/abstract=1790370 or http://dx.doi.org/10.2139/ssrn.1790370

Ouedraogo Nadia (Contact Author)

Université Paris Dauphine ( email )

France

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