HUMAN DEVELOPMENT- RENEWABLE ENERGY- GROWTH NEXUS IN THE TOP 10 ENERGY GLUTTONS

Abstract

This paper employs a trivariate panel VAR model to explore the link, if any, between the renewable energy consumption (REN), human development (HDI) and economic growth (GDP) in the period 1990-2015 for the sample of top 10 leading economies in terms of energy consumption. The most important findings of the panel VAR model suggest a positive response of economic growth to the human development. With regard to renewable energy, economic growth is found to respond negatively but only in the short- run. This response is found to decrease exponentially and to reach positive values in the long-run. The findings of this paper emphasize that policy makers need to do necessary efforts to develop strategies that will support the usage of renewable energy since it tends to contribute to key dimensions of human development and to the sustainable economic growth in the long-run.