Does Energy Consumption Boost Economic Growth in Bangladesh: Evidence from ARDL Bounds Testing Approach
Mir Khaled Iqbal Chowdhury *
Department of Economics, Pabna University of Science and Technology, Pabna, Bangladesh
Md. Abu Hasan
Department of Economics, Bangladesh Civil Service (General Education), Bangladesh
Md. Abdul Wadud
Department of Economics, University of Rajshahi, Rajshahi, Bangladesh
*Author to whom correspondence should be addressed.
Abstract
The paper assesses whether energy consumption leads to economic growth in Bangladesh applying the ARDL (autoregressive distributed lag) bounds testing approach of cointegration. We use time series data for the period from 1979 to 2014. Results report that energy use and economic growth cause each other to boost both in the short- and long-run. Policy implication is that the government needs to continue generating and ensuring supplying of energy to boost both economic growth and energy generation to achieve the ‘Vision 2041’ of developed country.
Keywords: Energy consumption economic growth, bounds test, error correction mechanism