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Advisor(s)
Abstract(s)
In this paper, new approaches are taken to explore two new dimensions
of the oil growth nexus that are relevant when focusing on oil producing countries.
Based on panel regressions, we regress per capita income on the ratio of oil production
to primary energy consumption and oil rents per capita, adding control
variables and exploring a relationship analysis within a multivariate oil-growth
nexus framework. The per capita oil consumption-economic growth nexus is
examined in a panel of oil producing countries over a long time span (1970–2012),
controlling for the exports of goods and services, the ratio of oil production to
primary energy consumption, the oil rents, and international crude oil prices. The
phenomenon of cross-sectional dependence that is present in the panel confirms that
these countries share common spatial patterns, unobserved common factors, or both.
The cointegration/long memory relationships, as well as the panel data estimators’
appropriateness, are both analysed and discussed. A dynamic Driscoll-Kraay estimator,
with fixed effects, is shown to be adequate to cope with the phenomena of
heteroskedasticity, contemporaneous correlation, first order autocorrelation and
cross-sectional dependence, present in the panel. Oil consumption drives economic
growth, but only on the short-run. The ratio of oil production to primary energy
consumption has exerted a positive impact on growth in both the short- and longrun.
Oil prices only exert a positive effect on growth in the short-run. Oil rents
depress growth in both the short- and long-run, suggesting that it is more a curse
than a blessing for the economies.
Description
Keywords
Oil production Oil rents Oil-growth nexus Macro panels