Energy Consumption and Economic Growth Nexus in the SAARC Region
Abstract
In recent years, demand for energy consumption has increased, especially in emerging countries such as the South Asian Association for Regional Cooperation (SAARC) member countries. This study thus aims to investigate the explicit relationship between energy consumption and economic growth in the SAARC countries. The researchers employed panel econometric techniques using data for the period 2002-2020. The study used pooled OLS, fixed effect and GLS estimators for estimation purposes. The pivotal results of the work revealed that the nexus of energy consumption with per capita income is not only significant but also takes an inverted u-shaped. As research evidence in the SAARC region is limited, we expect policymakers working in the energy sector to benefit significantly from the results of this study. This work contributes to the limited empirical studies exploring the impact of energy consumption on economic growth specifically in the SAARC region, with interesting findings that provide important insights to the SAARC region on electricity consumption and per capita income.
Keywords: energy consumption, economic growth, SAARC countries, panel data.
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