**The relationship among renewable energy, economic growth, labor and capital formation in Italy**

**Journal Title:**RIVISTA DI STUDI SULLA SOSTENIBILITA'

**Author/s:**Cosimo Magazzino, Gordon L. Brady

**Year:**2018

**Issue:**1

**Language:**English

**Pages:**14

**Pg.**35-48

**FullText PDF:**281 KB

**DOI:**10.3280/RISS2018-001005

(DOI is like a bar code for intellectual property: to have more infomation: clicca qui and here

This study investigates the nexus between renewable energy consumption and economic growth in Italy in the 1970-2007 years. The unit root tests results point out that our four variables are integrated of order one. Cointegration analysis reach contradictory results. However, the long-run estimations reveal that, if renewable energy consumption increases by 1%, real GDP decreases by 0.23%. The Toda and Yamamoto approach shows that exists a unidirectional causal flow, running from renewable energy consumption to aggregate income, in line with the "growth hypothesis". Moreover, these results are confirmed by Granger causality tests. While forecasts applications set out that VAR forecasts represent an improvement on simpler forecasts in more than half the comparisons, for each variable. In fact, VAR gives more accurate forecasts, over-performing the mean, RW, and AR methods.

**Keywords:**Renewable energy consumption, GDP; time series; Italy.

**Jel Code:**B22; C32; N54; Q43.

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