Electricity consumption and human development level: A comparative analysis based on panel data for 50 countries

As a representative of modern energy, the level of electricity consumption can be regarded as an appraisal criterion of a country’s development level. This study analyses the causality between electricity consumption and human development and assesses the changing trend of electricity consumption. The models in this study are established using panel data from 1990–2009 for 50 countries divided into four groups according to income. For human development indicators, per-capita GDP, consumption expenditure, urbanisation rate, life expectancy at birth and the adult literacy rate were selected. The results show that long-run bidirectional causality exists between electricity consumption and five indicators. Additionally, the higher the income of a country, the greater is its electricity consumption and the higher is its level of human development. Further, the variables of four income-groupings vary considerably. Specifically, as income increases, the contribution of electricity consumption to GDP and consumption expenditure increases, but the urbanisation rate, life expectancy at birth and adult literacy rate present a weakening trend. This mainly because that the latter indicators in high-income countries are increasing to converge. To improve human development, electricity should be incorporated into the basic public services construction to enhance the availability of electricity for low-income residents.

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