An Econometric Study of Economic Growth, Energy and Exports in Mauritius: Implications for Trade and Climate Policy
While electricity from fossil fuels is among a major source of greenhouse gases and global warming, it is also a key resource in the industrial sector geared towards exports and economic growth. This study attempts to examine the export-GDP nexus and electricity-GDP nexus in addition to a supplement...
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| Format: | Article |
| Language: | English |
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EconJournals
2012-01-01
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| Series: | International Journal of Energy Economics and Policy |
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| Online Access: | http://econjournals.com/index.php/ijeep/article/view/254/151 |
| Summary: | While electricity from fossil fuels is among a major source of greenhouse gases and global warming, it is also a key resource in the industrial sector geared towards exports and economic growth. This study attempts to examine the export-GDP nexus and electricity-GDP nexus in addition to a supplementary hypothesis between exports and electricity in Mauritius for the period of 1970-2009. An augmented neo-classical aggregate production model is used. The ARDL bounds test and the Johansen cointegration test confirm the existence of a long-run relationship between these variables. The multivariate Granger-causality analysis indicates that electricity and exports Granger-cause economic growth in the long-run. Electricity remains a significant causal variable in the short-run and is also found to lead exports. The empirical findings suggest that conserving electricity as a climate policy may not be conducive for exports and economic growth. The use of renewable sources for electricity may be the right option. |
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| ISSN: | 2146-4553 |