The Impacts of Energy Consumption, Energy Prices and Energy Import-Dependency on Gross and Sectoral Value-Added in Sri Lanka

Murshed, M and Mahmood, H and Alkhateeb, T and Bassim, Mohga (2020) The Impacts of Energy Consumption, Energy Prices and Energy Import-Dependency on Gross and Sectoral Value-Added in Sri Lanka. Energies, 13 (6565). pp. 1-22. ISSN 1996-1073

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Abstract

Drifting away from the neoclassical growth conjecture of economic growth being solely dependent on capital and labor inputs, this paper aimed to evaluate the dynamic impacts of energy consumption, energy prices and imported energy-dependency on both gross and sectoral value added figures of Sri Lanka. The analysis has particularly used the robust econometric methods that can account for structural break issues in the data. The results, in a nutshell, indicated that energy consumption homogeneously contributes to gross, agricultural, industrial and services valueadditions in Sri Lanka. However, positive oil price shocks and greater shares of imported energy in the total energy consumption figures are found to dampen the growth figures, especially in the context of the gross, industrial and services value additions. Besides, the joint growth-inhibiting impacts of oil price movements and energy import-dependency are also ascertained. On the other hand, the causality estimates reveal bidirectional causal associations between energy consumption gross value-added and energy consumption-industrial value-added. In contrast, no causal impact of energy consumption on the agricultural and services value-added is evidenced. Hence, these findings impose key policy implications for constructing crucial energy policy reforms to make sure that the economic growth performances of Sri Lanka are sustained in the future.

Item Type: Article
Additional Information: Accepted: 11 December 2020
Uncontrolled Keywords: energy consumption; energy prices; energy imports; economic growth; sectoral value added
Subjects: H Social Sciences > HA Statistics
J Political Science > JA Political science (General)
J Political Science > JQ Political institutions Asia
Divisions: School of Humanities > Economics and International Studies
Depositing User: Mohga Bassim
Date Deposited: 26 Mar 2021 14:27
Last Modified: 26 Mar 2021 14:27
URI: http://bear.buckingham.ac.uk/id/eprint/504

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