Survey the Effect of Types of Renewable and Non-renewable Energies Consumption on Economic Welfare in Iran

Document Type : Original Article

Authors

1 MA student in Economic Systems Planning, Shahrood University of Technology, Shahrood, Iran

2 Assistant Professor of Economics, Shahrood University of Technology, Shahrood, Iran

Abstract

The role of energy for welfare and economic development of countries highlights importance of energy. So far, no major study was conducted on the effects of energy on economic welfare in Iran. Hence, this study surveys the effect of the consumption of renewable and non-renewable energy on economic welfare in Iran during the period 1981-2018. ARDL model and cointegration approach had used to determine the existence of short-term and long-term relationships among variables. Estimation results show adjustment speed of error correction model to long-term equilibrium is about 61%. The relationship between economic welfare and exogenous variables such per-capita GDP, labor force, Gini index and types of renewable and non-renewable energy sources (solar, wind, water, geothermal, oil, gas and gasoline) is straightforward in short and long terms. One percent incraseing in the exogenous variables of research leads to an increase of 0.85, 0.66, 0.45, 0.61, 0.56, 0.36, 0.31, 0.72, / 76, and 0.34 percent in the welfare of society. Despite the relative abundance and non-optimal use of non-renewable energy (oil and gas) in Iran, the positive effect of renewable energy on economic welfare indicates use of this type of energy along with non-renewable energy will increase economic welfare.

Keywords

References

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History

  • Receive Date: 01 April 2021
  • Revise Date: 12 September 2021
  • Accept Date: 16 October 2021

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