Long-Run Elasticities of Electricity Consumption, FDI, Export and GDP in Malaysia

  •  Hussain Bekhet    
  •  Nor Salwati bt Othman    


This paper examines the co-integration and long run elasticity between electricity consumption (EC) and economic activities (FDI, export and industrial value added) for the 1971–2011 period. The F-Bound test was employed to estimate the long run relationship among the variables and logarithmic multiple regression model to determine the magnitude of changes in electricity consumption when there is a changes in economic activities. It shows a significant long run relationship among electricity consumption, FDI, export and industrial value added. This means that all the aforesaid variables achieve equilibrium in the long run and there is a possibility of causal relationship among variables at least in one direction. Also, it shows an evidence to the future researcher and academician particularly to developed general understanding and guidance for policy formulation.

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