An analysis of the asymmetric effects of natural gas consumption on economic growth in Pakistan: A non-linear autoregressive distributed lag approach

Autor: Haider Mahmood, Hafiz M. Sohail, Muntasir Murshed, Rafael Alvarado, Zengfu Li
Rok vydání: 2021
Předmět:
Zdroj: Environmental Science and Pollution Research. 29:5687-5702
ISSN: 1614-7499
0944-1344
DOI: 10.1007/s11356-021-15987-9
Popis: Natural gas is an important energy resource that is used to produce the national output of Pakistan.On the other hand, since natural gas is a relatively cleaner energy resource compared to oil and coal, enhancing the level of natural gas use is believed to improve the environmental quality in Pakistan which, in turn, can be expected to enable the nation to sustain its economic performances. Hence, it is pertinent to assess the effects of natural gas consumption on the nation’s economic growth level.The main objective of this paper was to explore the asymmetric effects of natural gas consumption, controlling for financial development, on Pakistan's economic growth level over the 1965–2019 period. The results from the Augmented Dickey-Fuller, Phillips-Perron, and Zivot-Andrews unit root tests confirmed a mixed order of integration among the variables. Besides, the bounds test and Gregory-Hansen cointegration analysis revealed evidence of long-run associations between economic growth, natural gas consumption, and financial development. Moreover, the outcomes from the non-linear autoregressive distributed lag model showed thatin the short-run positive changes in the natural gas consumption levels increase economic growth in Pakistan. On the other hand, in the long-run, positive and negative changes in natural gas consumption levels increase and decrease the economic growth level, respectively, in the long-run. On the other hand, both positive and negative changes in the financial development level are found to reduce the economic growth level in the long-run. Furthermore, the Hacker-Hatemi-J causality analysis verifiedthat natural gas consumption influences the economic growth level in Pakistan; thus, the energy consumption-led growth phenomenon was unearthed. In line with these key findings, several policy level suggestions are put forward for Pakistan to boost its natural gas consumption figures in order to enhance its economic growth level in the future.
Databáze: OpenAIRE
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