Abstract

SALAZAR-NUNEZ, Héctor F.  and  VENEGAS-MARTINEZ, Francisco. Impact of Electric Power Consumption and Manufacturing Added Value on Economic Growth of the Member Countries of NAFTA: a Cointegrated Panel Data Model with Structural Change. Econ: teor. práct [online]. 2018, n.spe4, pp.77-102. ISSN 2448-7481.  https://doi.org/10.24275/etypuam/ne/e042018/salazar.

This paper is aimed at studying the relationships among the energy consumption, the value added of manufactures, and economic growth for the countries integrating NAFTA before and after the North American Free Trade Agreement (NAFTA). To do this, we use a panel data-based cointegration approach with structural change during 1970-2015. The estimation method used is the fully modified ordinary least squares. The found empirical evidence suggests that the value added of manufactures maintains a bi-directional causal relationship with GDP and neutral with energy consumption in the short run. However, in the long run explanatory variables have a unidirectional causal relationship towards GDP. Finally, the structural stability of the model is analyzed in the long term, by means of the estimation of the recursive residues, finding that after the signing of NAFTA a structural change was presented.

Keywords : Economic growth; electrical energy; technological innovation; panel data models; manufacture industry; F43; O13; Q55; C33.

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