Causality Among Energy Consumption, CO2 Emission, Economic Growth and Trade: A Case of India

Srinivasan P. (2014), Causality Among Energy Consumption, CO2 Emission, Economic Growth and Trade: The Case of India, Journal of Academic Research in Economics, Vol. 6, No. 3, pp. 315-335.

21 Pages Posted: 27 Jan 2015

See all articles by Srinivasan Palamalai

Srinivasan Palamalai

Presidency University; Presidency University

Date Written: January 27, 2015

Abstract

This paper investigates the causal nexus between energy consumption, CO2 emissions, economic growth and trade in India using the Perron (1989) unit root test, Gregory and Hansen (1996) cointegration test and Vector Error Correction Model. The study results exhibit a long-run relationship between energy consumption, CO2 emissions, economic growth and trade in India. The empirical results confirm that energy consumption influences the economic activity in the short-run, implying that higher rate of economic growth is driven by consumption demand for energy in the economy. This is also well in consistent with the findings of Paul and Bhattacharya (2004) in the Indian context. Further, the study detects one way causation exist from energy use to CO2 emission and trade, and CO2 emissions to economic growth in the short-run.

Keywords: Energy Consumption, Economic Growth, CO2 Emissions, Trade, Cointegration

JEL Classification: Q44, Q53, Q56

Suggested Citation

Palamalai, Srinivasan, Causality Among Energy Consumption, CO2 Emission, Economic Growth and Trade: A Case of India (January 27, 2015). Srinivasan P. (2014), Causality Among Energy Consumption, CO2 Emission, Economic Growth and Trade: The Case of India, Journal of Academic Research in Economics, Vol. 6, No. 3, pp. 315-335.. Available at SSRN: https://ssrn.com/abstract=2556156

Srinivasan Palamalai (Contact Author)

Presidency University ( email )

Bangalore, Karnataka, KS 560064
India
9611273853 (Phone)

HOME PAGE: http://https://presidencyuniversity.in/school-of-management-2/dr-p-srinivasan/

Presidency University ( email )

Bangalore, KS 560089
India

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