The Nexus between Renewable Energy Consumption and Economic Growth: Empirical Evidence from Jordan
Abstract
Existing literature on the relationship between renewable energy and economic growth yields mixed outcomes, since the impact of renewable energy consumption on economic growth can be negative, positive or insignificant. Using the autoregressive distributed lag (ARDL) method, this paper examines the nexus between renewable energy and economic growth in Jordan from 2000 to 2020, utilizing renewable electricity output (REO), renewable energy consumption (REC), and gross domestic product (GDP). Utilizing the Dickey–Fuller (ADF) and Philips–Perron (PP) unit root tests, the levels or differences of the stationary variables were explored. The statistically robust findings reveal that renewable energy usage has a substantial positive economic effects. The results indicate that stakeholders (including energy planners, governments, and private sector organizations) must collaborate to increase investment in renewable energy to secure long-term economic growth.