Renewable energy and growth: Evidence from heterogeneous panel of G7 countries using Granger causality

Tsangyao Chang, Rangan Gupta, Roula Inglesi-Lotz, Beatrice Simo-Kengne, Devon Smithers, Amy Trembling

Research output: Contribution to journalReview articlepeer-review

137 Citations (Scopus)


In this paper we examine the causal relationship between renewable energy consumption and economic growth across the G7 countries, using annual data for the period of 1990-2011. By employing the causality methodology proposed by Emirmahmutoglu and Kose (2011) [8], we investigate if there is a causal relationship between the variables. The advantage of this methodology is that it takes into account possible slope heterogeneity and cross-sectional dependency in a multivariate panel. The empirical results support the existence of a bi-directional causal relationship between economic growth and renewable energy for the overall panel. However, looking at the individual results for each country, the neutrality hypothesis is confirmed for Canada, Italy and the US; while for France and UK there is a unidirectional causality from GDP to renewable energy, and the opposite for Germany and Japan.

Original languageEnglish
Pages (from-to)1405-1412
Number of pages8
JournalRenewable and Sustainable Energy Reviews
Publication statusPublished - 29 Dec 2015
Externally publishedYes


  • Economic growth
  • G7 countries
  • Panel causality
  • Renewable energy

ASJC Scopus subject areas

  • Renewable Energy, Sustainability and the Environment


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