Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/251104 
Year of Publication: 
2020
Series/Report no.: 
EERI Research Paper Series No. 12/2020
Publisher: 
Economics and Econometrics Research Institute (EERI), Brussels
Abstract: 
This study presents the causality relationship between energy consumption and economic growth as a scope of Cobb Douglas production function by using Dynamic Panel Data Analysis for 28 European countries in the 1990-2014 period. The Dynamic Panel Data Analysis method proposed in this study considers the real Gross Domestic Production (GDP) as a dependent variable, while Capital, Labor, and Energy Consumption parameters are considered as independent variables. To indicate the causality relation between GDP and Capital, Labor and Energy Consumption parameters, Arellano-Bond autocorrelation test is applied by taking the first difference of the defined parameters. Furthermore, the Generalized Method of Moments (GMM) is used to validate the obtained results of the Arellano-Bond autocorrelation test. The results of this study show that the GDP has a direct relationship with all independent variables-i.e. Capital, Labor, and Energy Consumption. By a predefined value for the increase in these independent variables, each of the dependent variables demonstrates a unique amount of increase.
Subjects: 
Neoclassic Economy
Cobb-Douglas Production Function
Dynamic Panel Data,Arellano-Bond GMM Method
JEL: 
C22
Q20
Q43
Q47
Document Type: 
Working Paper

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