The impact of renewable energy consumption to economic growth: A replication and extension of Inglesi-Lotz (2016)

Abstract

This study replicates and extends the results presented in a top-cited article in this journal Inglesi-Lotz (2016) which analyzes the impact of renewable energy consumption to economic growth for the OECD countries by applying the ordinary least squares with fixed effect estimator on the data from 1990 to 2010. By using the same data and methods this study first produces and compare empirical results with those reported in the original article. Then it applies a set of new econometric methods on the same data to address heterogeneity in renewable energy and economic growth across the analyzed group of countries. The panel quantile regression estimation shows that the effect of renewable energy consumption on economic growth is positive for lower and low-middle quantiles, however its effect becomes negative for middle high-middle and higher quantiles when renewable energy consumption is proxied by the absolute value. Furthermore a negative impact of renewable energy on economic growth is observed in almost all quantiles when it is proxied by the share of renewable energy consumption to total energy consumption. These results greatly differ from those of the original study © 2020 Elsevier B.V. All rights reserved.