Effects of Energy Consumption on Economic Growth in Selected OECD Countries

Abstract

Energy is one of the most influential factors on economic growth and development. With the effect of population growth, industrialization and urbanization, the need for energy is constantly increasing around the world. In addition to the need for energy in all areas of life, energy has an extremely important place especially in large-scale industrial countries. On the other hand, energy has made many contributions to economic growth. Therefore, energy is the main factor in the basis of developed countries. In this context, there are many studies on energy consumption and economic growth in the literature. However, it is also known that in some countries, energy production cannot meet the energy consumption. In this context, it is seen that natural resources, whose supply is limited, have a very important place in economic growth analysis. For this purpose, it is aimed to examine whether there is a causal relationship between the variables in selected OECD countries (Belgium, Spain, France, Italy, Austria, Poland, Portugal, Sweden, Norway, United Kingdom) using energy consumption and economic growth data between 2000-2019. In this context, analyzes were made with the data obtained from the World Bank with the STATA econometric analysis package program. As a result of the analysis, it can be said that a one-way causality relationship between economic growth and energy consumption has been determined. Considering the Westerlund cointegration test result, the hypothesis that there is no cointegration at the 5% significance level is rejected.