The dynamic effects of renewable energy on economic growth: The case of China

Abstract

This paper estimates the possible effects of renewable energy consumption on the economic growth of the major renewable energy-consuming country in the world, China. As the top renewable energy-consuming country, this paper uses China to explain the growth process between 1990 and 2019. Using time-series analysis techniques, this study uses estimations and tests results from the different cointegration methods used in China. The results confirm the evidence of long-term dynamics between economic growth and traditional and energy-related inputs. Findings from long-term output elasticities indicate that renewable energy consumption has a significant positive impact on economic output. The findings suggest that governments, energy planners, international cooperation agencies and associated bodies must act together to increase renewable energy investment for low carbon growth in most of these economies.