Oil Usage, Gas Consumption and Economic Growth: Evidence from Poland

Abstract

This article investigates causal links between economic growth, oil consumption and natural gas usage in Poland on the basis of quarterly data for the period Q1 2000–Q4 2009. The application of the Toda–Yamamoto procedure, a nonlinear Granger causality test, bootstrap techniques and an analysis of vector error-correction model led to the conclusion that both oil and natural gas usage caused gross domestic product growth in the short term. However, in the long term causality ran in the opposite direction. Both these findings are believed to be the consequence of the recent transformation of the Polish economy from energy intensive activities towards services, which in general are not energy–consuming.

Keywords:

• cointegration
• economic growth
• Granger causality
• natural gas consumption
• nonlinear causality test
• oil consumption
• residual–based bootstrap
• Toda–Yamamoto method