THE JOURNAL OF ENERGY

AND DEVELOPMENT

Rene Zamarripa, Belem Vasquez-Galan,

and Olajide Oladipo,
“Dynamic Modeling of Electricity Consumption
and Industrial Growth in Mexico,”
Volume 43, Number 1

Copyright 2018
 DYNAMIC MODELING OF ELECTRICITY
CONSUMPTION AND INDUSTRIAL GROWTH
IN MEXICO

Rene Zamarripa, Belem Vasquez-Galan, and Olajide Oladipo*

Introduction

T oday most economic activities rely heavily on energy consumption (such as

electricity, natural gas, coal, or gasoline) to produce and distribute goods and
services. This implies that as economies increase their production and income,
more energy is required to achieve higher levels of production and consumption. It
is natural to assume that there is a close relationship between energy use and

*Rene Zamarripa earned a master’s degree in applied economics from El Colegio de la Frontera
Norte and is currently a Ph.D. candidate in economics at the University of California, Irvine. His
master’s dissertation addressed the correlation between energy consumption and economic growth in
Mexico. He is currently a teaching assistant at the University of California, Irvine, and a graduate
assistant instructor at Universidad Autonoma de Baja California, Mexico. His research interests
include applied macroeconomics, development and energy intensity, energy consumption and the
effects on economic growth, and environmental economics.
Belem Vasquez-Galan earned a master’s degree in applied economics from El Colegio de la
Frontera Norte (El Colef) and a Ph.D. in economics from the University of Birmingham (United
Kingdom). She is a researcher at the Department of Economics at El Colef in Mexico. Her research
interests include international trade, economic growth, energy consumption, and NAFTA. The
author’s works have appeared in The Journal of Applied Economics and The Mexican Journal of
Economics and Finance.
Olajide Oladipo is a Professor at York College of the City University of New York. He earned
both his bachelor and master’s degrees from Obafemi Awolowo University (Nigeria), a M.Phil.
degree from the University of Cambridge, and a Ph.D. from the University of Birmingham.
Dr. Oladipo has published numerous papers in peer-reviewed journals and currently serves as the
Editor-in-Chief of the International Journal of Economics and Finance in addition to being an
editorial member of other journals.

The Journal of Energy and Development, Vol. 43, Nos. 1 and 2

Copyright
2018 by the International Research Center for Energy and Economic Development
(ICEED). All rights reserved.
143
144 THE JOURNAL OF ENERGY AND DEVELOPMENT

economic growth in developed and developing countries, ceteris paribus. There is

evidence that global energy consumption has increased despite energy intensity
decreasing in some countries, this seem to happen as countries get richer and
require more energy sources that have to be imported.1 At the same time, natural
resource exploitation has significant repercussions that require finding a balance
to prevent long term damage. In this context, it is important to understand the
nature of the relationship between energy and economic growth to develop poli-
cies that support sustainable growth.
Despite its relevance, there is not a consensus among researchers on whether
energy consumption leads to economic growth or growth leads to more energy
consumption. Some empirical studies from the 1970s found a strong correlation
between development and energy consumption, developing countries like India
were achieving higher growth rates and, at the same time, they were consuming
larger amounts of energy.2 In countries with higher levels of development, such as
the United States, it was revealed that energy and gross national product (GNP)
were strongly correlated in the period 1947 to 1974. However the data showed that
energy consumption was preceded by economic growth, which was an implication
that growth was relatively independent from energy resources; thus, it was viewed
positively that any energy conservation policies to reduce exploitation would not
necessarily interfere with economic growth.3
Recent literature shows that in many cases, energy consumption boosts eco-
nomic growth. Economic activities require energy not only to produce final goods
and services, but also to distribute them in the market; therefore, energy prices and
availability are factors to consider for economic growth. In a sample of 28
countries with different levels of development, K. Medlog and R. Soligo found
evidence that increases in energy supply and demand were necessary to stimulate
output production.4 Similar results were provided by other studies that used dif-
ferent samples and time frames.5 In this context, we expect that countries with
large oil resources would show energy as explicative of output growth; however,
while this is true for some countries like Nigeria,6 Iran,7 and Brazil,8 this is not the
same in some rich oil nations such as Saudi Arabia, Iran, and Kuwait. In these
situations, as economic growth rises energy consumption has increased.9
A growing economy will lead to increased energy consumption and vice versa,
so whether or not energy is being used efficiently, its availability needs to rise to
boost economic growth. It is also possible to find that energy consumption and
economic growth depend on each other; for instance J. Chontanawat and R. Pierse
found in a group of 30 OECD countries and 70 non-OECD countries that higher
levels of production increase energy consumption, but also more energy con-
sumption leads to more production.10 This result seems to prevail in other studies
with shorter samples.11 A. Omri provides a comprehensive empirical review of 48
studies and he found that 56 percent of their results support the energy to growth
hypothesis, 23 percent support the existence of causality from growth to energy,
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 145

and 21 percent of the studies did not find any meaningful relationship.12 Most of
these studies rely on the application of time-series analysis as this methodology
allows data establishing the nature of the relationship.
Mexico is a developing country with important natural resources based on
fossil fuels. In the 1980s, crude oil exports were the main source of income for the
economy as its share amounted to 60 percent of total exports; however economic
liberalization and diversification reduced its share to 13 percent in 2006.13 In order
to modernize the oil industry and increase production, in 2013 the government
introduced an energy reform to liberalize oil extraction and commercialization.
The reform was aimed at reducing the public monopoly of one of the most im-
portant natural resources and, by increasing its production, the government ex-
pects to reduce prices of secondary energy sources.14
Despite the relevance of oil in the economy, there are a limited number of
empirical studies on the relationship between energy consumption and economic
growth in Mexico. K. Caballero and L. Galindo estimated a vector error-correction
model (VECM) to understand how energy consumption and energy prices relate to
growth (proxied by income) in Mexico.15 Using data from 1964 to 2004, they
found a strong link among the variables. For instance, energy elasticity to income
was positive while energy and income elasticities to prices were negative but
relatively smaller.16 In other words, prices cannot be used as a public policy to
stimulate economic growth since their impact on energy consumption is negli-
gible. One possible reason is that, at the industry level, there is a sizeable dif-
ference on how much they demand and consume energy in order to produce and
distribute their goods and services, so activities by larger consumers should be
more sensitive to price changes than those that are not. An analysis of Mexican
manufacturers provides an indication that, on average, they are sensitive to energy
price changes and, in particular, electricity price changes since this is the main
energy source. The activities with elasticities greater than average were production
of non-metals, metals, machinery, and transport equipment.17 These results sug-
gest that it is essential to distinguish between economic growth in general and at
the industrial level since most of GDP is generated by secondary rather than
primary activities. Therefore, it is important to consider differences in energy
consumption among economic activities in order to find meaningful relationships
between energy and output. In this regard, instead of using GDP as a representa-
tion of national output, R. Zamarripa measured output in general and from three
economic sectors: agriculture, industry, and the tertiary sector, and then looked for
a difference in their link to energy prices in Mexico.18 The results showed that
GDP and electricity consumption are not cointegrated and causality only goes
from energy to GDP, while it was confirmed that electricity prices were only
statistically significant for the industrial and tertiary sectors.
In this context, our goal is to identify if there is cointegration and causality
between economic growth and energy in terms of electricity consumption and
146 THE JOURNAL OF ENERGY AND DEVELOPMENT

whether or not there is a difference if we only account for industrial production

since most of the electricity demand comes from industrial activities. This paper
contains five sections: the introduction, an overview of energy and electricity in
Mexico, a presentation of the model specification and variables description, the
estimation results, and our conclusion.

The Energy Sector in Mexico

Similar to other developing and developed countries, GDP in Mexico is pos-

itively correlated to energy use. In figure 1, a scatter plot shows that as GDP has
increased, energy use per capita has also increased.
Energy can be divided into two types depending on its source. Primary energy
refers to materials in its raw state. In this respect, 69 percent of Mexico’s primary
energy comes from crude oil. Secondary energy is the result of using fossil fuels to

Figure 1
a
MEXICO: ENERGY USE AND GROSS DOMESTIC PRODUCT (GDP), 1971–2013

a
Energy use refers to primary energy used before transformation to other end-use fuels plus
imports and stock changes, minus exports and fuels supplied to ships and aircraft engaged in
international transport.
Source: Authors’ calculation based on data from the World Bank, World Development
Indicators (Washington, D.C.: The World Bank, January 28, 2017).
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 147

produce another source of energy such as electricity, gasoline, diesel, and gas.
Crude oil producers could use some of these resources to produce secondary
energy. However, in Mexico insufficient refining capacity has forced the country
to become a net crude oil exporter and to import a large amount of secondary
energies from abroad.
It is important to highlight that different economic activities require different
sources of secondary energy. For instance, while transportation is the main con-
sumer of gasoline and diesel, manufacturing is the main consumer of natural gas
and electricity. In 2014 the industrial sector consumed 58.2 percent of the elec-
tricity.19 In general, total energy can be measured by petajoules. Parenthetically,
a joule (J) refers to the amount of work to produce one watt per second, one
petajoule is equal to 1015 J. In figure 2, we see total energy consumption by the
consumer: residential, transportation, agriculture, and industry. From 1993 to
2014, transportation is the activity with the highest energy consumption in Mexico.
Industrial activities rank second and residential and agricultural consumption are
third. With regards to electricity consumption and GDP, it is evident that both
variables are closely related. In figure 3, we see that they are positively correlated.

Figure 2
a
TOTAL ENERGY CONSUMPTION IN MEXICO, 1993–2014

a
Energy consumption includes electricity, diesel, natural gas, kerosene, gasoline, and others.
Source: Authors’ calculations based on data from Instituto Nacional de Estadı́stica y GeografÍa,
“Indicadores de Eficiencia Energetica en Los Sectores Industrial y Primario,” Mexico City, 2011.
148 THE JOURNAL OF ENERGY AND DEVELOPMENT

Econometric Methodology

In order to analyze the dynamic relationship between energy consumption and

economic growth in Mexico, this paper uses the neo-classical production function
with labor, capital, and energy used as separate inputs in the production tech-
nology. We note from the literature that the framework has been used in previous
studies.20, Thus, the neo-classical function that relates output to a set of inputs can
be expressed as:

Qt ¼ f ðKt ; Lt ; Et Þ ¼ At Kta Lbt Etg ð1Þ

where Qt is the real GDP, K is the real physical capital stock, L is the labor input,
and E is the energy input. With a constant return-to-scale Cobb-Douglas pro-
duction function, a + b + g = 1, and by taking the natural logarithm, equation (1)
can be expressed in per-capita form as:
ln qt ¼ b0 þ b1 ln et þ b2 ln kt þ b3 ln lt þ m1;t ð2Þ

Figure 3
ELECTRIC POWER CONSUMPTION AND GROSS DOMESTIC PRODUCT (GDP) IN
a
MEXICO, 1971–2013

a
Electric power consumption measures the production of power plants and combined heat and
power plants less transmission, distribution, and transformation losses and own use by heat and
power plants.
Source: Authors’ calculations based on The World Bank, World Development Indicators
(Washington, D.C.: The World Bank, January 28, 2017).
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 149

where qt is the per-capita real GDP, et is the per-capita real energy consumption,
and kt is the per-capita real capital stock. Also, qt = Qt/Pt; et = Et/Pt; kt = Kt/Pt;
lt = labor. b1, b2, and b3 are the elasticities of per-capita real output with respect
to the per-capita real energy, per-capita real capital inputs, and labor.
Method of Analysis: We employ the “Johansen procedure,” which is a mul-
tivariate estimation technique that uncovers long-run stationary relationships
among sets of non-stationary data. The multivariate approach, with its allowance
for the potential endogeneity of all the variables of interest, eliminates the single-
equation bias, which has been problematic for previous studies. Furthermore, the
approach allows users to investigate the speed of adjustment to the long-run
equilibrium, along with any short-run relationships, which may exist.
The model specification—equation (2)—in a vector autoregression (VAR)
representation is as follows:
yt ¼ P0 þ P1 yt1 þ . . . þ Pp ytp þ Wi X mt þ et ð3Þ
where yt is a (2x1) vector of endogenous variables, Xmt is a (2x1) vector of ex-
ogenous variables, m = 1,2. P0 is a (2x1) vector of constant terms, Pj is a (2xn)
matrix of autoregressive coefficients with j = 1,2, …, p, where p is the lag length.
Wi is a (2x2) matrix of exogenous variables coefficients, and et is a (2x1) vector of
errors. In extended form, with two exogenous variables:
2 3


q
 yt1


q 
qt P0 P11 P12 . . . P1p 6 yt2 7 V11 V12 kt e
¼ þ 4 5þ þ te
et Pe0 P21 P22 . . . P2p ... V 21 V 22 lt et
ytp
ð4Þ

If the endogenous variables share a long-run relationship, then the model has to
consider an error-correction mechanism. This means that the specification should
be as follows:

dyt ¼ Qyt1 þ Y1 dyt1 þ . . . þ Yp1 dytpþ1 þ F1 dX 1t þ . . . þ FdX 4t1 þ et

ð5Þ
where dyt is a (2x1) vector of endogenous variables in first differences, Qm is an
identity matrix (2x2), yt-1 is a vector of cointegration equations, Yi is a coefficient
matrix of lagged endogenous variables in first differences, Fk is a (2x2) coefficient
matrix of exogenous variables in first differences, and y et is a (2x1) vector of errors.
Data and Data Sources: GDP and gross fixed capital formation were deflated
to represent billion pesos from 2008; they were also seasonally adjusted. Energy
consumption is measured by total electricity consumption in billion watts per
150 THE JOURNAL OF ENERGY AND DEVELOPMENT

hour. These variables were divided by population to obtain per-capita units. In

order to compare the estimations we also used per-capita industrial GDP (qi) and
per-capita industry’s electricity consumption (ei). Other exogenous variables in-
cluded in the model were the price of electricity in general (p), price of electricity
paid by industry (pi), and the U.S. GDP (uq) to account for the close link between
the Mexican and U.S. economies.
All the variables were transformed to natural logarithms. The data source is
from Instituto Nacional de Estadı́stica y Geografia,21 which processes information
from the Mexican Energy Ministry. The data frequency is quarterly from 1993 to 2015.
The first step in the Johansen procedure involves carrying out unit root tests on
all the variables of interest. By definition, a time series is said to be stationary if its

Table 1
AUGMENTED DICKEY-FULLER (ADF) AND PHILLIPS-PERRON (PP) STATISTICS FOR
a
UNIT ROOT TESTS FOR STATIONARITY
(Test equation has a trend and intercept, 1993:1 to 2015:4)

Hypothesis of Unit Root

Levels First Differences
Series ADF PP ADF PP

q -2.331 -2.844 -7.448** -7.43**

prob 0.413 0.186 0.000 0.000
e -1.419 -1.476 -6.953** -6.99**
prob 0.849 0.831 0.000 0.000
k -1.982 -2.543 -6.312** -6.35**
prob 0.603 0.307 0.000 0.000
p -2.847 -2.277 -6.48** -5.82**
prob 0.185 0.441 0.000 0.000
uq -2.735 -2.729 -8.581** -8.58**
prob 0.225 0.227 0.000 0.000
l -4.063 -2.600 -10.93** -11.11**
prob 0.010 0.281 0.000 0.000
pi -0.070 0.628 -7.663** -8.26**
prob 0.999 0.999 0.000 0.000
qi -1.736 -2.094 -7.57** -7.57**
prob 0.727 0.542 0.000 0.000
ei -1.303 -1.324 -7.34** -7.43**
prob 0.881 0.876 0.000 0.000

a
** Denotes the rejection of the null hypothesis at the 1-percent level of significance.
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 151

Table 2
a
COINTEGRATION RESULTS WITH A LINEAR TREND
(where Ø is the number of cointegrating vectors)

Estimates of Max-Eigen and Trace Statistics

Alternative Critical Value Critical Value
Null ⌈ Max-Eigen (95%) Trace (95%)

Series: q & e, lags interval: 1 to 9

0 1 8.977 14.265 10.150 15.495
£1 2 1.173 3.841 1.173 3.841
Series: qi & ei, lags interval: 1 to 7
0 1 25.570** 14.265 35.240** 15.495
£1 2 9.669** 3.841 9.669** 3.841

a
The vector autoregssion (VAR) lag selections satisfied residual tests such as mathematical
stability, hereroskedasticity, normality, and serial correlation; ** denotes the rejection of the null
hypothesis at the 1-percent level of significance.

means, variance, and covariances are all invariant with respect to time.22 The unit
root tests suggested by Phillips and Perron23 have two main advantages over the
corresponding Augmented Dickey-Fuller (ADF) test.
First, in contrast to the ADF test, which includes more explanatory variables to
deal with the autocorrelated residuals and reduces the degrees of freedom, the
Phillips-Perron (PP) test overcomes the problem of autocorrelation by using a non-
parametric correction. Second, the test is valid under more general assumptions
about the sequence of innovations, hence, allowing for all finite ARMA processes.
However, one of the drawbacks of the Phillips-Perron unit root test is that the
number of autocovariances used for the Newey-West estimator of the error-term
variances is arbitrary. Finally, though irrespective of the above comments on ADF
(i.e., its drawback) and the merits of the Phillips-Perron test highlighted above, we
use both the ADF and PP tests to investigate stationarity.
The unit root test results indicate that all the series are non-stationary in
first differences (table 1). Therefore, we proceeded to apply the Johansen
cointegration test to the endogenous variables, i.e., production and electricity
consumption, for the whole economy and for industry. The results are shown in
table 2.
The cointegration test results show that q and e do not share a long-run re-
lationship; therefore, the estimation of equation (4) can be run with variables in
first differences. However, there is a long-run relationship between qi and ei, so
this model has to include an error-correction mechanism.
152 THE JOURNAL OF ENERGY AND DEVELOPMENT

Table 3
UNRESTRICTED VAR ESTIMATIONS—ENDOGENOUS VARIABLES: GROSS
a
DOMESTIC PRODUCT (GDP) AND ELECTRICITY CONSUMPTION, 1993–2015
(4 lags)

Endogenous variables
3.1 3.2 3.3
Variables Dq De Dq De Dq De

Constant 0.001 0.002 0.001 0.002 0.001 0.001

[1.234] [0.796] [1.081] [0.745] [0.637] [0.642]
D1 -0.001 0.224 0.020 0.235 -0.001 0.229
[-0.013] [1.387] [0.239] [1.434] [-0.014] [1.357]
Dk 0.301** 0.217** 0.298** 0.215** 0.317** 0.221**
[12.119] [4.613] [12.174] [4.552] [10.961] [3.914]
Dp 0.026 0.013 0.022 0.012
[1.853] [0.485] [1.573] [0.435]
D uq 0.019 0.006
[1.226] [0.185]
Granger causality
Chi-sq. 10.534* 5.676 8.603 5.586 8.990 5.398
R-2 0.738 0.411 0.749 0.413 0.754 0.413
White test 226.22 (0.062) 81.26 (0.097) 88.06 (0.096)
Jarque Bera test 0.734 (0.947) 1.027 (0.905) 0.788 (0.940)
LM test 5.199 (0.267) 2.565 (0.629) 2.669 (0.614)

a
q = per-capita real GDP; e = real per-capita electricity consumption; l = labor; k = per-capita real
capital stock; p = price of electricity; and uq = real U.S. domestic output. D refers to the first
difference. ** and * denote the rejection of the null hypothesis at the 1-percent and 5-percent level of
significance, respectively.

Empirical Results

In order to understand how energy and output relate to each other in general,
once we found that these variables were not cointegrated, we ran three different
estimations of equation (3), where l, k, p, and uq entered as exogenous variables. In
table 3, we see that real capital stock per capita (k) was the only statistically
significant coefficient. Despite the increasing amount of electricity consumption,
its price change does not seem to have an impact on output growth or consumption
in the Mexican economy. The causality test indicates that electricity consumption
Granger causes GDP. However this result is only valid for the most restricted
estimation (3.1) and does not hold to other estimations.
Industry is the main consumer of electricity in Mexico; hence, if we focus our
analysis on the relationship between output and electricity consumption in
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 153

Table 4
VECTOR ERROR-CORRECTION (VEC) ESTIMATIONS—ENDOGENOUS VARIABLES:
INDUSTRIAL GROSS DOMESTIC PRODUCT (GDP) AND INDUSTRIAL ENERGY
a
CONSUMPTION, 1993–2015
(11 lags)

Endogenous variables
4.1 4.2 4.3 4.4
qi ei qi ei qi ei qi ei

Constant
0.0041* 0.0008 0.0009 -0.0022 0.00078 -0.0022 0.0003 -0.0002
[1.924] [0.284] [0.577] [-0.821] [0.498] [-0.806] [0.156] [-0.066]
D1
0.3144** 0.788** 0.0386 0.567** 0.039 0.567** 0.0225 0.601**
[2.081] [3.832] [0.326] [2.764] [0.329] [2.750] [0.188] [2.927]
Dk
0.413** 0.342** 0.406** 0.334** 0.416** 0.299**
[6.966] [3.326] [6.762] [3.201] [6.765] [2.841]
D pi
0.0197 0.015 0.0227 0.0078
[0.902] [0.402] [1.051] [0.2115]
D uq
0.0262 -0.0658
[0.964] [-1.411]
ECMt-1
-0.372** -0.337** -0.257** -0.216 -0.252** -0.217* -0.226** -0.252**
[-4.893] [-3.262] [-3.717] [-1.797] [-3.698] [-1.833] [-3.387] [-2.201]
Granger causality
31.159** 17.965 12.337 15.478 10.902 15.506 10.157 14.612
R-2
0.622 0.665 0.800 0.713 0.803 0.715 0.806 0.727

a
t statistics are in brackets; qi = per-capita real industry’s GDP; ei= per-capita electricity
consumption in the industry; l = labor; k = per-capita real capital stock; p = price of electricity; and
uq = real U.S. domestic output. D refers to the first difference. ** and * denote the rejection of the
null hypothesis at the 1-percent and 5-percent level of significance, respectively.

industry and not in the whole economy, the results provide a better understanding
of this nexus. From the cointegration test, it is known that the endogenous vari-
ables share a long-run relationship, so we estimated a vector error-correction
model—equation (5)—with different specifications (table 4).
154 THE JOURNAL OF ENERGY AND DEVELOPMENT

Some of the similarities between the macro and the industry level is that real
capital stock per capita (k) was statistically significant as an explanatory variable
of the electricity and output growth equations and Granger causality only occurs
from energy to output; although, this result is not robust to different model esti-
mations. In regard to industry, labor growth seems to be an important element to
explain electricity consumption; this could be an indication that labor activities are
using electricity more intensively.
In summary, the estimations provide two relevant findings. First, there is no
cointegration when we consider total GDP and total electricity consumption,
which is similar to what earlier studies found. 24 Since the variables are I(1), the
VAR estimations show that only real capital stock growth (Dk) was statistically
significant as an explanatory variable of output and energy consumption growth in
Mexico, no matter how many exogenous variables were included. The results
indicate that Granger causality only occurs from energy to GDP. Second, in order
to account for the energy consumption that is closely related to industrial output,
we found that they share a long-run relationship; they are cointegrated. In the
estimation of the VEC, with the same exogenous variables as the VAR model, real
capital stock growth was also statistically significant as an explanatory variable of
energy and output growth in the industrial sector. In this case, labor growth was
significant. The estimations at the industrial level confirm that Granger causality
only happens from energy to output.
It was interesting to find that electricity prices were not statistically significant
in any model estimation; this result is similar to what other studies have found,25 i.
e., changes in energy prices are unlikely to impact energy consumption. An im-
portant implication, in terms of public policy, is that price policies would be in-
effective as a mechanism used by the government to reduce energy consumption
or stimulate economic growth.

Conclusion

This paper investigates the nature of the relationship between energy and
economic growth in Mexico and whether or not there is a difference if we account
for industry since this sector tends to consume larger amounts of electricity. Using
Johansen techniques, we found that there is only a long-run relationship between
industrial output and electricity consumption and that Granger causality only
occurs from energy to GDP. It is important to highlight that energy is key for
economic growth. In the mainstream growth models, the production is only
a function of capital and labor, so that it does not recognize the potential of policies
applied to improve energy resources. We also found that electricity prices were not
statistically significant as an explanatory variable of total and industrial outputs.
The results suggest that energy policies would not be ineffective for the whole
economy, especially for economic growth.
 MEXICO: ELECTRICITY CONSUMPTION & GROWTH 155

NOTES
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10
J. Chontanawat and R. Pierse, “Causality between Energy Consumption and GDP: Evidence
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(SEED) no. 113, School of Economics, University of Surrey, 2006.
11
C.-C. Lee, “The Causality Relationship between Energy Consumption and GDP in G-11
Countries Revisited,” Energy Policy, vol. 34, no. 9 (2006), pp. 1086-093; M. Mehrara, op. cit.; and
D. Omotor, “Causality between Energy Consumption and Economic Growth in Nigeria,” Pakistan
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12
A. Omri, “An International Literature Survey on Energy-Economic Growth Nexus: Evidence
from Country-Specific Studies,” Renewable & Sustainable Energy Reviews, vol. 38, issue C (2014),
pp. 951–59.
13
Banxico, “Balanza Comercial de Mercancias,” Banco de Mexico, June 22, 2017.
156 THE JOURNAL OF ENERGY AND DEVELOPMENT
14
V. Rodriguez Padilla, “Industria Eléctrica en México: Tensión entre El Estado y El Mer-
cado,” Revista Problemas del Desarrollo, vol. 47, no. 185 (2016), pp. 35–57.
15
K. Caballero and L. Galindo, “El Consumo de Energı́a en México y Sus Efectos en El
Producto y Los Precios,” Problemas del Desarrollo Revista Latinoamericana de Economı́a, vol.
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16
Ibid.
17
J. Alvarez and F. Valencia, “Made in Mexico: Energy Reform and Manufacturing Growth,”
International Monetary Fund Working Paper no. WP/15/45, Washington, D.C., 2015.
18
R. Zamarripa, “Consumo de Electricidad y Crecimiento Económico en México,” (Master’s
thesis, El Colegio de la Frontera Norte, Mexico, August 2016).
19
Mexico, Secretaria de Energia (SENER), “Prospectiva del Sector Electrico 2015-2029,”
Mexico City, 2015.
20
K. Ghali, “Energy Use and Output Growth in Canada: A Multivariate Cointegration Analysis,”
Energy Economics, vol. 26, no. 2 (2004), pp. 225–38; Y. Wolde-Rufael, “Energy Consumption and
Economic Growth: The Experience of African Countries Revisited,” Energy Economics, vol. 31,
no. 2 (2009), pp. 217–24; and M. Belloumi, “Energy Consumption and GDP in Tunisia: Cointe-
gration and Causality Analysis,” Energy Policy, no. 37, no. 7 (2009), pp. 2745–753.
21
Instituto Nacional de Estadı́stica y Geografı́a (INEGI), “Banco de Información Económica,”
Mexico City, January 4, 2017.
22
This implies that a stationary series tends to return to its mean value and fluctuate around it
within a more or less constant range, while a non-stationary series has a different mean at different
points in time and its variance increases with the sample size.
23
P. C. B. Phillips and P. Perron, “Testing For Unit Root in Time Series Regression,” Bio-
metrika, vol. 75, no. 2 (1988), pp. 335–46.
24
R. Zamarripa, op. cit.
25
K. Caballero and L. Galindo, op. cit.