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Estimating the causality and elasticities of residential electricity consumption for Malaysia

The residential sector is the third-largest electricity user in Malaysia. A clear understanding of the rapid growth in its electricity consumption is crucial to the formulation of energy and environmental policy. This study applied the Autoregressive Distributed Lags, Vector Error Correction Model,...

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Main Authors: Othman N.S., Hariri N.H.M.
Other Authors: 57194072376
Format: Article
Published: Econjournals 2023
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spelling my.uniten.dspace-264802023-05-29T17:11:01Z Estimating the causality and elasticities of residential electricity consumption for Malaysia Othman N.S. Hariri N.H.M. 57194072376 57336305500 The residential sector is the third-largest electricity user in Malaysia. A clear understanding of the rapid growth in its electricity consumption is crucial to the formulation of energy and environmental policy. This study applied the Autoregressive Distributed Lags, Vector Error Correction Model, and Variance Decomposition Approach in determining the long-run and short-run interaction between electricity consumption by residential sector and the suggested independent variables for 1980-2020 period. The selection of variables is based on the theory of demand. The outcomes confirmed the existence of a long-run relationship among variables. Also, the significant short-run elasticities of residential electricity consumption due to the changes in income and price. However, there is no significant short-run elasticity of residential electricity consumption due to the changes in occupancy and technology. In terms of causality interaction, results show the unidirectional causality running from electricity consumption, income, technology, and occupancy to electricity price in the long run; and the unidirectional causality running from income and occupancy to electricity price in the short run. The bidirectional causality also exists between electricity consumption and electricity price; and technology and electricity price in the short run. The research findings could be beneficial for policymakers in strengthening long-lasting economic policies. � 2021, Econjournals. All rights reserved. Final 2023-05-29T09:11:01Z 2023-05-29T09:11:01Z 2021 Article 10.32479/ijeep.11727 2-s2.0-85119010797 https://www.scopus.com/inward/record.uri?eid=2-s2.0-85119010797&doi=10.32479%2fijeep.11727&partnerID=40&md5=181eb29563a3d38937516047c3ab8efe https://irepository.uniten.edu.my/handle/123456789/26480 11 6 335 346 All Open Access, Gold Econjournals Scopus
institution Universiti Tenaga Nasional
building UNITEN Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Tenaga Nasional
content_source UNITEN Institutional Repository
url_provider http://dspace.uniten.edu.my/
description The residential sector is the third-largest electricity user in Malaysia. A clear understanding of the rapid growth in its electricity consumption is crucial to the formulation of energy and environmental policy. This study applied the Autoregressive Distributed Lags, Vector Error Correction Model, and Variance Decomposition Approach in determining the long-run and short-run interaction between electricity consumption by residential sector and the suggested independent variables for 1980-2020 period. The selection of variables is based on the theory of demand. The outcomes confirmed the existence of a long-run relationship among variables. Also, the significant short-run elasticities of residential electricity consumption due to the changes in income and price. However, there is no significant short-run elasticity of residential electricity consumption due to the changes in occupancy and technology. In terms of causality interaction, results show the unidirectional causality running from electricity consumption, income, technology, and occupancy to electricity price in the long run; and the unidirectional causality running from income and occupancy to electricity price in the short run. The bidirectional causality also exists between electricity consumption and electricity price; and technology and electricity price in the short run. The research findings could be beneficial for policymakers in strengthening long-lasting economic policies. � 2021, Econjournals. All rights reserved.
author2 57194072376
author_facet 57194072376
Othman N.S.
Hariri N.H.M.
format Article
author Othman N.S.
Hariri N.H.M.
spellingShingle Othman N.S.
Hariri N.H.M.
Estimating the causality and elasticities of residential electricity consumption for Malaysia
author_sort Othman N.S.
title Estimating the causality and elasticities of residential electricity consumption for Malaysia
title_short Estimating the causality and elasticities of residential electricity consumption for Malaysia
title_full Estimating the causality and elasticities of residential electricity consumption for Malaysia
title_fullStr Estimating the causality and elasticities of residential electricity consumption for Malaysia
title_full_unstemmed Estimating the causality and elasticities of residential electricity consumption for Malaysia
title_sort estimating the causality and elasticities of residential electricity consumption for malaysia
publisher Econjournals
publishDate 2023
_version_ 1806428080088023040
score 13.211869

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