Title:
ENERGY CONSUMPTION SECTORAL AND ECONOMIC GROWTH NEXUS, EVIDENCE IN INDONESIA: AN AUTOREGRESSIVE DISTRIBUTED LAG APPROACH

Authors:
Trian Gigih Kuncoro, Vincentius Hadi Wiyono, Mugi Rahardjo, Indonesia

Abstract:

The climate crisis that has occurred has caused concern for countries in the world. The potential increase in the average temperature of the earth's surface above the expected threshold makes most countries in the world agree to reduce the amount of carbon emissions. Energy conservation is one of the logical plans that every country can do. However, differences in the economic conditions of a country ultimately create obstacles in the transition of fossil energy to renewable energy, concerns about the economic slowdown as a result of the energy conservation process, especially for developing countries. So from becoming an important discussion regarding the relationship between energy use and the economy for developing countries, in this case Indonesia. The study uses time series data for the period 1990-2019. The approach used in examining the relationship between energy consumption and economic growth is the ARDL bounds test. The results show a unidirectional relationship from economic growth to the energy consumption of the transportation sector in the short run. In the long run, the unidirectional relationship runs from economic growth to energy consumption in the commercial and public services sectors.