Combustible renewables and waste consumption, exports and economic growth: Evidence from panel for selected MENA countries

This paper examines the causal relationship between combustible renewables and waste consumption, exports and economic growth for a panel of eleven Middle East and North Africa (MENA) countries for the period 1975-2008. We use the Granger causality and the vector error correction model (VECM) to investigate both the short-run and the long-run dynamic relationship between these variables. The results from the panel Granger causality test indicate that in the short-run economic growth has a positive and statically significant impact on exports. However, there is no causal link between economic growth and combustible renewables and waste consumption, and between exports and combustible renewables and waste consumption. In the long-run, the results from the panel error correction model indicate that there is evidence of long-run causality from economic growth and exports to combustible renewables and waste consumption and from economic growth and combustible renewables and waste consumption to real exports. The policy implication of this finding is that combustible renewables and waste is not sufficiently used in private or public industrial sectors in emerging economies, and the consumption policy reserved for production encourages households to use fossil fuels or renewable energy