The Casual Relationship between Fossil Fuel Consumption and Real GDP Growth in China

摘要

A modified version of the Granger causality test model, within the multivariate framework, proposed by Toda and Yamamoto (1995) was adopted to study the causality between the fossil fuel consumption and real GDP in China for the time period of 1978-2009. The empirical results demonstrated that there exists a negative bi-directional Granger causality between fossil fuel consumption and real GDP. The findings indicate that policies promoting energy conservation and reducing fossil fuel consumption may not necessarily be the obstructive factors to the economic growth in China.