Energy Use for Economic Growth: Cointegration and Causality Analysis from the Agriculture Sector of Pakistan

Khalid Mushtaq, Faisal Abbas, Abedullah ., Abdul Ghafoor


Productivity is closely associated with direct and indirect
use of energy as an input. The importance of energy can not be denied as
one of the basic inputs to economic growth process. The consumption of
energy has been among the critical indicators of the level of
development of any country. It is observed that usually the developed
countries use more energy per unit of economic output and far more
energy per capita than developing countries. This reflects the adoption
of increasingly more efficient technologies for energy production and
utilisation as well as changes in the composition of economic
activities. This, largely, needs a shift in energy use [Cheng and Lai
(1997)]. When this shift in the composition of final energy use is taken
into account energy use and the level of economic activity are found to
be tightly coupled. The prospect of large reduction in the energy use
intensity of economic activity seems limited. So, the accelerated demand
results in the scarcity of energy and increasing cost have severe
implications for economic growth. This ever increasing role of energy in
the present day scenario underlines the need to increase the supply of
energy and to find some new alternative energy sources and energy
conservation techniques

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