Author(s): Ercan ÅAHBUDAK* Dilek ÅAHÄ°N
Energy plays a crucial role in the economic growth and development of a country. This study investigates both the short and long term dynamic relationship between energy consumption, trade openness and economic growth in Turkey through econometric model during the period 1980-2013. The long term results show that trade openness has positive and insignificant relationship with energy consume. The results show that increase of 1 percent trade openness energy consume increase by 0.13 percent in Turkey. Real GDP has positive and significant relationship with energy consume. This results show that increase of 1 percent real GDP energy consume increase by 0.50 percent in Turkey. The short term results show that trade openness has positive and significant relationship with energy consumption. The results show that increase in the trade openness by 1 percent leads to 0.22 percent increase in energy consumption. Real GDP has positive and significant relationship with energy consumption. The results show that increase in the real GDP by 1 percent leads to 0.88 percent increase in energy consumption. Estimated lagged error correction term (ECM-1) is negative and statistically significant.
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