The Relationship Between Electricity, Foreign Direct Investment and Economic Growth in Central Asian Countries

Yıl 2018, Cilt: 18 Sayı: 2, 321 - 328, 01.04.2018

Selçuk Koç , Shukhrat Saıdmurodov

https://doi.org/10.21121/eab.2018237358

Cited By: 8

Öz

The role of the energy sector in the economic

growth and development of countries is not

questionable. Thus, this sector process and

structure are very important. The renewable

energy resources are energies obtained from the

continuous energies occurring naturally. In the

Central Asian countries, the hydro electrical energy

is one of the renewable energy resources, and it

should be utilized by these countries to improve

this sector. Energy consumption is one of socialeconomic

development indicators. There are so

many literatures about the relationship between

energy consumption and economic growth. Unlike

previous literatures, in this study FDI has been added

as a third variable. In this study, whether or not FDI

increases the economic growth and then economic

growth increases energy consumption, will be

analyzed by using time series methods analysis.

Moreover, these relationships will be analyzed in five

Central Asian (Kazakhstan, Kyrgyzstan, Tajikistan,

Turkmenistan and Uzbekistan) countries during

period 1991 to 2014. In this study, stationarity of

series is formed and Johansen Cointegration test

is utilized to see whether or not series are moving

together in the long term.

Anahtar Kelimeler

Energy Consumption, Growth, FDI, Central Asia, Panel Causality

Kaynakça

• Aitken, B. & Harrison, A. (1999) “Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela” American Economic Review 89(3): 605–618.
• Basu, P., Chakraborty, C. & Reagle, D. (2003) “Liberalization, FDI, and Growth in Developing Countries: A Panel Co-integration Approach” Economic Inquiry 51: 510–516.
• Blomstrom, M., Lipsey, R. E. & Zejan, M. (1994) “What Explains Developing Country Growth?” In: Convergence of Productivity: Cross-National Studies and Historical Evidence, London: Oxford University Press.
• Borensztein, E., De Gregorio, J. & Lee, J. W. (1998) “How Does Foreign Investment Affect Growth?” Journal of International Economics 45: 115–135.
• Breitung, J. (2000) “The Local Power of Some Unit Root Tests for Panel Data” Advances in Econometrics 15: Nonstationary Panels, Panel Co-integration, and Dynamic Panels, ed. B. H. Baltagi, Amsterdam: JAY Press, 161-178
• Breitung, J. & Das, S. (2005) “Panel Unit Root Tests Under Cross-sectional Dependence” Statistica Neerlandica 59: 414–433.
• Carkovic, M. & Levine, R. (2005) “Does Foreign Direct Investment Accelerate Economic Growth?” Theodore Moran
• Ciarreta, A. & Zarraga (2010) “Economic Growth - Electricity Consumption Causality in 12 European Countries: A Dynamic Panel Data Approach” Energy Policy 38(7): 3790–3796.
• De Gregorio, José (2003) “The Role of Foreign Direct Investment and Natural Resources in Economic Development” Working Paper No. 196. Banco Central de Chile Documentos de Trabajo, Santiago.
• De Mello, L. (1997) “Foreign Direct Investment in Developing Countries and Growth: A Selective Survey” Journal of Development Studies 34(1): 1–34.
• Ferguson, R., Wilkinson, W. & Hill, R. (2000) “Electricity Use and Economic Development” Energy Policy 28(13): 923–934.
• Fichtner GmbH & Co. KG. (2012) Central Asia Regional Economic Cooperation: Power Sector Regional Master Plan (Technical Assistance Consultant’s Report for the
• Asian Development Bank, October 2012), available at http://www.adb.org/projects/documents/central-asiaregional- economic-cooperation-power-sectorregionalmaster- plan-tacr; Mercado’s-Energy Markets International, Load Dispatch and System Operation Study for Central Asian Power System (October 2010).
• Fields, D. Kochnakyan, A. Stuggins, G. & Besant-Jones, J. (2013) “Tajikistan’s Winter Energy Crisis: Electricity Supply and Demand Alternatives” (World Bank, Washington, DC, 2013).
• Hadri, K. (2000) “Testing for Stationarity in Heterogeneous Panel Data” Econometrics Journal 3: 148–161.
• Herzer, D. (2008) “The Long Run Relationship Between Outward FDI and Domestic Output: Evidence from Panel Data” Economic Letters 100(1): 146-149.
• Im, K. S., Pesaran, M. H. & Shin, Y. (2003) “Testing for Unit Roots in Heterogeneous Panels” Journal of Econometrics 115: 53–74.
• International Energy Agency (2016) http://www.iea. org/ (25.03.2016). International Renewable Energy Agency (2015) http:// www.irena.org/ (25.03.2016).
• Levin, A., Lin, C. F. & Chu, C. S. J. (2002) “Unit Root Tests in Panel Data: Asymptotic and Finite-Sample Properties” Journal of Econometrics 108: 1–24.
• Lipsey, R. E. (2002) “Home and Host Country Effects of FDI” NBER Working Paper No. 9293
• Maddala, G. S. & Shaowen W. (1999) “Comparative Study of Unit Root Tests with Panel Data and a New Simple Test” Oxford Bulletin of Economics and Statistics, Special issue, 61: 631-652.
• Mah, J. (2010) “Foreign Direct Investment Inflows and Economic Growth of China” Journal of Policy Modelling 32: 155–158.
• Mulloev, D. M. (2009) “Gidroelektricheskiye Proekti Tadjikistana v Kontekste Integratsii Tsentralno Aziatskikh Stran SHOS” Vestnik, Strategic Research Center Under the President of Tajikistan, Tajikistan and Contemporary World, 2(21): 78–79.
• Nair-Reichert, U. & Weinhold, D. (2001) “Causality Test for Cross-Country Panels: A New Look at FDI and Economic Growth in Developing Countries” Oxford Bultein of Economics and Statistics 63(2): 53-171.
• Narayan, P. K., Smyth, R. & Prasad, A. (2007) “Electricity Consumption in the G7 Countries: A Panel Cointegration Analysis of Residential Demand Elasticities” Energy Policy, 35(9): 4485–4494.
• Pedroni, P. (2000) “Fully-Modified OLS for Heterogeneous Co-Integrated Panels” Advances in Econometrics, 15: 93- 130.
• Pedroni, P. (2001) “Purchasing Power Parity Tests in Co- Integrated Panels” Review of Economics and Statistics, 83: 727-731.
• Rodrik, D. (1999) “The New Global Economy and Developing Countries: Making Open- ness Work” Policy Essay No: 24. Overseas Development Council, Washington, DC.
• Sarisoy, I. & Koç S. (2012) “The Effect of Foreign Direct Investment on Poverty: Panel Regression Analysis for 40 Selected Underdeveloped and Developing Countries” Çukurova Üniversitesi, Sosyal Bilimler Enstitüsü Dergisi 21(3): 225-240.
• Siddiqui, R. (2004) “Energy and Economic Growth in Pakistan” The Pakistan Development Review, 43: 175-200.
• Solehzoda, A. (2015) “Potensial Stran Tsentralnoy Azii v Ekonomicheskoy Integratsii S Evraziyskim Ekonomicheskim Soyuzom” International Center for Trade and Sustainable Development, 8.
• Tarı, R. (2010) “Ekonometri” 6. Baskı, Kocaeli: Kocaeli Üniversitesi Yayınları.
• Vu, T. B. & Noy, I. (2009) “Sectoral Analysis of Foreign Direct Investment and Growth in the Developed Countries” International Financial Markets Institutions and Money, 19: 402-413.
• Wolde-Rufael, Y. (2006) “Electricity Consumption and Economic Growth: A Time Series Experience for 17 African Countries” Energy Policy, 34: 1106–1114.
• World Bank (2014) “Key Issues for Consideration on the Proposed Rogun Hydropower Project” http://www. worldbank.org/en/region/eca/brief/rogun-assessmentstudies