Energy Consumption, Income and Price Interactions in Saudi Arabian Economy: A Vector Autoregression Analysis

Advances in Management & Applied Economics, vol.1, no.2, 2011, 1-21

21 Pages Posted: 26 Nov 2013 Last revised: 2 Nov 2014

See all articles by M. Ibrahim

M. Ibrahim

Aswan University, Department of Economics

Date Written: January 1, 2011

Abstract

This paper presents an empirical analysis of the interactions among energy consumption, real income and energy price in Saudi Arabia using annual data from 1982 to 2007. We analyzed the dynamic interaction by applying widely used time series analysis techniques such as unit root tests, Vector Autoregressive model, Granger causality tests, impulse response functions and the forecast error variance decompositions. Results show that real income and energy consumption are clearly Granger causal for energy price, and there is bidirectional causality between energy consumption and income. On the other hand energy price isn't a Granger causal for either energy consumption or real income. Thus, real income can play an important role in policy that targeting to enhance the energy efficiency to save energy in Saudi Arabia.

Suggested Citation

Ibrahim, Mohamed, Energy Consumption, Income and Price Interactions in Saudi Arabian Economy: A Vector Autoregression Analysis (January 1, 2011). Advances in Management & Applied Economics, vol.1, no.2, 2011, 1-21, Available at SSRN: https://ssrn.com/abstract=2359746 or http://dx.doi.org/10.2139/ssrn.2359746

Mohamed Ibrahim (Contact Author)

Aswan University, Department of Economics ( email )

Egypt, Aswan
Aswan, 81524
Egypt

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
20
Abstract Views
326
PlumX Metrics