On the Relationship between Foreign Direct Investment and Energy Consumption: The Mexican Case


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Authors

  • Alí Aali-Bujari
  • Francisco Venegas-Martínez

Abstract

This paper is aimed at analyzing the interrelation between Foreign Direct Investment (FDI) and Energy Consumption (EC) in Mexico during the period 1970-2014. To do that, we carry out a cointegration test and a Granger causality analysis. The empirical results from the cointegration test show a stable link between the growth rates of FDI and EC in the long run. While the results from Granger's causality show that in the short run there is a unidirectional Granger causality from the growth rate of FDI toward the growth rate EC, while in the medium and long there is a bidirectional causality between the growth rates of FDI and LEC in Mexico during the period under study.Keywords: foreign direct investment, energy consumption, cointegration, Granger causalityJEL Classifications: C32, F21, Q43.DOI: https://doi.org/10.32479/ijeep.10988

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Published

2021-04-10

How to Cite

Aali-Bujari, A., & Venegas-Martínez, F. (2021). On the Relationship between Foreign Direct Investment and Energy Consumption: The Mexican Case. International Journal of Energy Economics and Policy, 11(3), 231–235. Retrieved from https://www.econjournals.com/index.php/ijeep/article/view/10988

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