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Energy consumption and economic growth: Evidence from China at both aggregated and disaggregated levels by Jia-Hai Yuan; Jian-Gang Kang; Chang-Hong Zhao; Zhao-Guang Hu is a Economics, Econometrics and Finance article available to read on EtoBox.

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Using a neo-classical aggregate production model where capital, labor and energy are treated as separate inputs, this paper tests for the existence and direction of causality between output growth and energy use in China at both aggregated total energy and disaggregated levels as coal, oil and electricity consumption. Using the Johansen cointegration technique, the empirical findings indicate that there exists long-run cointegration among output, labor, capital and energy use in China at both aggregated and all three disaggregated levels. Then using a VEC specification, the short-run dynamics of the interested variables are tested, indicating that there exists Granger causality running from electricity and oil consumption to GDP, but does not exist Granger causality running from coal and total energy consumption to GDP. On the other hand, short-run Granger causality exists from GDP to total energy, coal and oil consumption, but does not exist from GDP to electricity consumption. We thus propose policy suggestions to solve the energy and sustainable development dilemma in China as: enhancing energy supply security and guaranteeing energy supply, especially in the short run to provid

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Author

Jia-Hai Yuan; Jian-Gang Kang; Chang-Hong Zhao; Zhao-Guang Hu

Publisher

Elsevier Science; Elsevier ; Elsevier BV (ISSN 0140-9883)

Published

2008

Language

EN

Field

Economics, Econometrics and Finance (Social Sciences)