On the asymmetric effects of financial deepening on renewable and non-renewable energy consumption: insights from China

Figures & data

Table 1. Variable definitions.

Variables	Symbol	Definitions
Renewable energy consumption	RE	Renewable energy is measured in quad BTU from the sum of wind energy, solar energy, nuclear energy, and biofuel energy.
Non-renewable energy consumption	NRE	Non-renewable energy is measured in quad BTU from the sum of coal, natural gas, and petrol.
Bank deposits	BD	Bank deposits to GDP (%)
Broad money	BM	Broad money (M2) as a percent of GDP
Remittances	REM	Personal remittances, received (% of GDP)
Trade openness	Trade	Trade (% of GDP)
GDP growth	GDP	GDP per capita growth (annual %)

Source: Energy Information Administration (EIA), International Monetary Fund (IMF), World Development Indicators (WDI).

Table 2. Unit root testing.

	Unit root without break test			Unit root with break test
	I(0)	I(1)	Decision	I(0)	Break date	I(1)	Break date	Decision
RE	−0.715	−2.926*	I(1)	−1.942	2012	−7.586***	2008	I(1)
NRE	0.679	−2.628*	I(1)	−2.925	2004	−4.231*	2002	I(1)
BD	−0.794	−3.039**	I(1)	−2.756	2014	−6.152***	2005	I(1)
BM	−1.342	−5.072***	I(1)	−2.542	2008	−6.023***	2016	I(1)
REM	−3.854***		I(0)	−4.285*	2001			I(0)
Trade	−1.637	−3.594**	I(1)	−3.324	2010	−4.923**	2009	I(1)
GDP	−1.712	−6.145***	I(1)	−3.021	2007	−6.087***	2010	I(1)

Source: Authors’ Calculations.

Table 3. NARDL estimates of renewable and non-renewable energy consumption.

	RE				NRE
Variable	Coefficient	Std. error	t-statistic	Prob.	Coefficient	Std. error	t-statistic	Prob.
Short-run
D(BD_POS)	−0.065	0.047	1.388	0.237	−0.010	0.008	1.301	0.284
D(BD_POS(−1))	−0.077*	0.043	1.797	0.147	0.013	0.011	1.122	0.344
D(BD_NEG)	−0.294*	0.157	1.873	0.134	−0.078*	0.044	1.665	0.100
D(BD_NEG(−1))	0.986***	0.211	4.677	0.010	−0.023	0.025	0.951	0.412
D(BM_POS)	6.113**	2.864	2.134	0.100	−0.641	0.432	1.482	0.235
D(BM_POS(−1))	2.101	1.782	1.179	0.304	−0.469	0.366	1.283	0.290
D(BM_NEG)	11.21**	4.475	2.506	0.066	0.774	0.658	1.177	0.324
D(BM_NEG(−1))	15.52***	4.587	3.384	0.028	3.089	1.991	1.552	0.219
D(GDP)	0.244***	0.049	5.026	0.007	0.025**	0.010	2.370	0.099
D(GDP(−1))	0.107	0.068	1.571	0.191	−0.020**	0.008	2.568	0.083
D(TRADE)	0.031	0.025	1.235	0.285	−0.003	0.004	0.841	0.462
D(TRADE(−1))					−0.003	0.005	0.533	0.631
D(REM)	−0.922**	0.446	2.068	0.107	0.343***	0.098	3.507	0.039
D(REM(−1))					−0.085	0.068	1.250	0.300
Long-run
BD_POS	0.249***	0.054	4.646	0.010	−0.011*	0.005	1.958	0.145
BD_NEG	−1.501***	0.139	10.76	0.000	−0.045***	0.015	2.912	0.062
BM_POS	7.150**	3.160	2.263	0.086	−1.071***	0.288	3.717	0.034
BM_NEG	−1.177***	0.278	4.228	0.013	−4.311***	0.630	6.845	0.006
GDP	0.462	0.149	3.107	0.036	0.031***	0.010	3.079	0.054
TRADE	−0.085	0.027	3.174	0.034	0.006**	0.003	2.237	0.111
REM	−1.058	0.938	1.128	0.323	0.418**	0.158	2.648	0.077
C	0.421	1.135	0.371	0.730	2.678***	0.079	34.01	0.000
Diagnostic
F test	18.47***				4.356***
ECM(−1)	−0.625***	0.131	4.771	0.009	−0.660**	0.334	1.977	0.119
LM	0.132				1.345
BGP	1.288				0.987
RESET	0.125				1.534
CUSUM	S				S
CUSUMsq	S				S
Wald-LR-BD	5.356***				3.658*
Wald-SR-BD	3.687*				0.321
Wald-LR-BM	4.688***				3.658*
Wald-SR-BM	3.358*				1.358

Note: ***p **e: R-B**p **e: R-BMtma*p Mtma R

Source: Authors’ Calculations.

Figure 1. Dynamic multiplier of RE.

Source: Authors’ Calculations.

Figure 2. Dynamic multiplier of NRE.

Source: Authors’ Calculations.

Table 4. Asymmetric causality.

Null hypothesis:	F-statistic	Prob.	Null hypothesis:	F-statistic	Prob.
BD_POS → RE	2.223	0.133	BD_POS →NRE	5.329	0.013
RE → BD_POS	1.090	0.354	NRE →BD_POS	2.849	0.080
BD_NEG → RE	3.539	0.047	BD_NEG →NRE	1.481	0.250
RE → BD_NEG	6.043	0.009	NRE →BD_NEG	3.948	0.035
BM_POS → RE	2.104	0.147	BM_POS →NRE	2.662	0.093
RE → BM_POS	0.097	0.908	NRE →BM_POS	1.458	0.255
BM_NEG → RE	7.309	0.004	BM_NEG → NRE	0.523	0.600
RE → BM_NEG	2.205	0.135	NRE →BM_NEG	3.381	0.053
GDP → RE	1.216	0.316	GDP →NRE	0.537	0.592
RE → GDP	1.723	0.202	NRE →GDP	1.904	0.173
TRADE → RE	4.829	0.018	TRADE →NRE	4.405	0.025
RE → TRADE	1.120	0.344	NRE →TRADE	0.553	0.583
REM → RE	0.032	0.969	REM →NRE	1.254	0.305
RE → REM	1.987	0.161	NRE →REM	1.971	0.163
BD_NEG → BD_POS	2.661	0.093	BD_NEG →BD_POS	2.661	0.093
BD_POS → BD_NEG	2.988	0.072	BD_POS →BD_NEG	2.988	0.072
BM_POS → BD_POS	6.060	0.008	BM_POS →BD_POS	6.060	0.008
BD_POS → BM_POS	2.488	0.107	BD_POS →BM_POS	2.488	0.107
BM_NEG → BD_POS	3.345	0.055	BM_NEG →BD_POS	3.345	0.055
BD_POS → BM_NEG	2.393	0.116	BD_POS →BM_NEG	2.393	0.116
GDP → BD_POS	4.969	0.017	GDP →BD_POS	4.969	0.017
BD_POS→ GDP	0.136	0.873	BD_POS →GDP	0.136	0.873
TRADE → BD_POS	6.661	0.006	TRADE → BD_POS	6.661	0.006
BD_POS → TRADE	2.694	0.091	BD_POS →TRADE	2.694	0.091
REM → BD_POS	0.332	0.721	REM →BD_POS	0.332	0.721
BD_POS → REM	1.085	0.356	BD_POS →REM	1.085	0.356
BM_POS → BD_NEG	3.454	0.051	BM_POS →BD_NEG	3.454	0.051
BD_NEG → BM_POS	0.158	0.855	BD_NEG →BM_POS	0.158	0.855
BM_NEG → BD_NEG	2.371	0.118	BM_NEG →BD_NEG	2.371	0.118
BD_NEG → BM_NEG	1.338	0.284	BD_NEG →BM_NEG	1.338	0.284
GDP → BD_NEG	0.237	0.791	GDP →BD_NEG	0.237	0.791
BD_NEG → GDP	1.569	0.232	BD_NEG →GDP	1.569	0.232
TRADE → BD_NEG	1.894	0.175	TRADE →BD_NEG	1.894	0.175
BD_NEG → TRADE	0.893	0.424	BD_NEG →TRADE	0.893	0.424
REM → BD_NEG	0.782	0.470	REM →BD_NEG	0.782	0.470
BD_NEG → REM	1.654	0.215	BD_NEG →REM	1.654	0.215
BM_NEG → BM_POS	7.557	0.003	BM_NEG →BM_POS	7.557	0.003
BM_POS → BM_NEG	1.241	0.310	BM_POS →BM_NEG	1.241	0.310
GDP → BM_POS	14.67	0.000	GDP →BM_POS	14.67	0.000
BM_POS → GDP	0.964	0.397	BM_POS →GDP	0.964	0.397
TRADE → BM_POS	3.246	0.059	TRADE →BM_POS	3.246	0.059
BM_POS → TRADE	3.841	0.038	BM_POS →TRADE	3.841	0.038
REM → BM_POS	0.123	0.885	REM →BM_POS	0.123	0.885
BM_POS → REM	1.404	0.268	BM_POS →REM	1.404	0.268
GDP → BM_NEG	2.320	0.123	GDP →BM_NEG	2.320	0.123
BM_NEG → GDP	4.721	0.020	BM_NEG →GDP	4.721	0.020
TRADE → BM_NEG	1.299	0.294	TRADE →BM_NEG	1.299	0.294
BM_NEG → TRADE	0.936	0.408	BM_NEG →TRADE	0.936	0.408
REM → BM_NEG	0.256	0.777	REM →BM_NEG	0.256	0.777
BM_NEG → REM	2.321	0.123	BM_NEG →REM	2.321	0.123
TRADE → GDP	0.856	0.439	TRADE →GDP	0.856	0.439
GDP → TRADE	4.011	0.033	GDP →TRADE	4.011	0.033
REM → GDP	0.416	0.665	REM →GDP	0.416	0.665
GDP → REM	0.218	0.806	GDP →REM	0.218	0.806
REM → TRADE	0.316	0.732	REM d→TRADE	0.316	0.732
TRADE → REM	0.635	0.539	TRADE →REM	0.635	0.539

Note: ***p < 0.01; **p < 0.05; and *p < 0.1.

Source: Authors’ Calculations.