ENERGY CONSUMPTION AND PRODUCTIVITY IN NIGERIA
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Date
2015
Journal Title
Journal ISSN
Volume Title
Publisher
academia.edu
Abstract
Energy is critical to the survival and expansion of any economy, but in Nigeria, energy
consumption has been skewed towards household use, and below thresholds for sector driven
growth. The paper updates in time and methodology those studies highlighting the significance of
energy use for economic growth, using the Bound test and the Auto regression Distributed Lag
(ARDL) to establish the long and short run relationships between disaggregated energy
consumption and economic growth in Nigeria from 1990 to 2016. The variables considered were
real GDP, energy consumption decomposed into electricity and petroleum consumption, labor and
capital. The findings showed that, in the short and long run, petroleum consumption and labour
have a significant positive relationship with GDP. Furthermore, the causality results showed that
feedback causation between economic growth and energy consumption as well as labour exists,
while one-way causation runs from labour to economic growth. The expansion and diversification
of the power-generation portfolio in the country would improve energy consumption towards
better output. Also, policies to encourage industrialization would move energy demand towards
increasingly productive uses.
Description
Keywords
Energy Consumption, Economic Growth, Industrialisation, Error Correction