Effect of Energy Prices on Economic Growth in the ECOWAS Sub-Region: Investigating the Channels Using Panel Data |
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| Authors: | Prince Boakye Frimpong Akua Oforiwaa Antwi Samuel Ebi Yamike Brew |
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| Institution: | 1. Department of Economics, Management and Quantitative Methods, Universita degli Studi di Milano, Milano, Italy;2. Fidelity Bank Ghana Ltd, Accra, Ghana;3. Department of Economics, Methodist University College Ghana, Accra, Ghana |
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| Abstract: | The article empirically examines the effect of energy prices on economic growth within the Economic Community of West African States sub-region by acknowledging that the effect of energy prices on growth is quintessentially indirect and hence can be tracked through some channels. Exploiting the System Generalized Methods of Moments estimation technique for the period spanning 2002–2015, the results indicate that the overall effect of energy prices on economic growth is significantly negative. This effect propagates mainly through government consumption expenditure and investment, albeit its effect through real interest rate is positive. However, its negative effects on government consumption, investment, and exchange rate significantly overwhelm the positive effect from real interest rate. |
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| Keywords: | Ghana energy prices economic growth System GMM |
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