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Open AccessArticle

Linear and Nonlinear Causality between Energy Consumption and Economic Growth: The Case of Mexico 1965–2014

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Instituto de Investigaciones Económicas y Empresariales (Economic and Business Research Institute), Universidad Michoacana de San Nicolás de Hidalgo, Edificio ININEE, Ciudad University, C.P. 58030, Morelia, Mich., Mexico
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Department of Economic Analysis II, University of the Basque Country (UPV/EHU), Avda. Lehendakari Aguirre, 83, 48015 Bilbao, Spain
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Department of Applied Economics III (Econometrics and Statistics), University of the Basque Country (UPV/EHU), Avda. Lehendakari Aguirre, 83, 48015 Bilbao, Spain
*
Author to whom correspondence should be addressed.
Energies 2018, 11(4), 784; https://doi.org/10.3390/en11040784
Received: 12 February 2018 / Revised: 9 March 2018 / Accepted: 13 March 2018 / Published: 29 March 2018
This paper analyzes the causal link between aggregated and disaggregated levels of energy consumption and economic growth in Mexico between 1965 and 2014, with the presence of structural breaks stemming from the series. To that end, unit root with structural breaks, cointegration, and linear and nonlinear causality tests are employed. The results show that there is a long-run relationship between production, capital, labor, and energy, and linear causal links from total and disaggregated energy consumption to economic growth. A nonlinear causality also exists from energy consumption, the transport sector, capital, and labor to output. These results support the growth hypothesis, which maintains that energy is an important input factor for economic activity and that energy conservation policies impact the economic growth in Mexico. View Full-Text
Keywords: causality; economic growth; structural breaks; energy consumption; Mexico causality; economic growth; structural breaks; energy consumption; Mexico
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MDPI and ACS Style

Gómez, M.; Ciarreta, A.; Zarraga, A. Linear and Nonlinear Causality between Energy Consumption and Economic Growth: The Case of Mexico 1965–2014. Energies 2018, 11, 784.

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