Growth and primary energy : why is this relationship important ? Mainstream economic models do not include energy as a factor that could foster economic growth. Ecological economists, often ascribe to energy the central role in economic growth. Is energy an important driver of economic growth ? If so, what is the magnitude of the dependency of growth from energy ? By Gael Giraud (CNRS, PSE, CES, Labex REFI) and Zeynep Kahraman (The Shift Project).
- Primary energy is a key factor that drives GDP growth: its long-run output elasticity evolved around 0.6.
- Capital accumulation has played a minor role compared to energy : long-run elasticity for capital around 0.2.
- These estimations are also robust to the choice of various sub periods of time and subsamples of countries.
- There are good reasons to believe that, the output elasticity of energy is decoupled from its GDP share.
- Our inquiry does not suggest that energy use be the sole first-order factor driving growth. Efficiency plays a dual, almost comparable role.
- Energy and GDP cointegrate and energy use univocally Granger causes GDP in the long-run
