Author:
Arshad Khan Muhammad,Ahmad Usman
Abstract
Energy is considered to be the life line of an economy, the
most vital instrument of socioeconomic development and has been
recognised as one of the most important strategic commodities [Sahir and
Qureshi (2007)]. Energy is not only essential for the economy but its
supply is uncertain [Zaleski (2001)]. Energy is a strategic source that
influenced the outcomes of wars, fueled and strangled economic
development and polluted as well as clean up the environment. In the era
of globalisation, a rapidly increasing demand for energy and dependency
of countries on energy indicate that energy will be one of the biggest
problems in the world in the next century. This requires for alternative
and renewable sources of energy. Traditional growth theories focus much
on the labour and capital as major factor of production and ignore the
importance of energy in the growth process [Stern and Cleveland (2004)].
The neo-classical production theories stresses that economic growth
increases with the increases in labour, capital and technology. Today
energy is indispensable factor and plays an important role in the
consumption as well as production process.1 Research suggests that
energy plays an important role as compared to other variables included
in the production and consumption function for countries which are at
intermediate stages of economic development [IEA (2005)]. When we
examine disaggregating components of energy demand, it is seen that
electricity is the highest quality energy component and its share in
energy consumption increases rapidly. Natural gas, petroleum and coal
follow electricity respectively.
Publisher
Pakistan Institute of Development Economics (PIDE)
Subject
Development,Geography, Planning and Development
Cited by
59 articles.
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