ANALYSIS OF EFFECT OF ENERGY CONSUMPTION ON ECONOMIC GROWTH IN NIGERIA

A DISAGGREGATED APPROACH

Abstract

The study investigated the impact of energy consumption on economic growth in Nigeria for the period 1980-2021. Ex-post facto research design was adopted in the investigation. Multiple regression analysis was employed, in which Auto-Regressive Distributed Lag (ARDL) as the method of analysis was utilized in the research. The ARDL model evaluates short run and long-run interactions among the specified variables. The results revealed the presence of long-run relationship among the variables. The results showed that both residential energy consumption and industrial energy consumption exert positive and significant effect on economic growth in Nigeria. The results also indicated that public sector energy consumption has a negative and insignificant effect on economic growth in Nigeria in the short run while in the long run 0, it has positive and insignificant effect on economic growth in Nigeria. Based on the findings, the study therefore recommends that government should ensure that the demand for electricity is met in the residential, public and industrial sectors of the economy by improving the nation's electricity generating capacity to meet the daily demand.