The Effect of Energy Consumption Growth on Value-added Growth of Economic Sectors: Markov Models

Document Type : Research Article

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Abstract

In this paper an attempt is made to study the impact of energy consumption growth on forming regimes of low and high value-added growth of economic sectors of Iran economy by using seasonal data from 1346 to 1392. So, in some models, Markov switching model with the supposition of fixed transition probabilities by value-added growth of economic sectors variable were expanded. According to modeling results, increase in energy consumption growth, leads to increase in value-added growth of economic sectors in Iran economy. In addition in modeling value-added growth of agriculture group and value-added growth of manufacturing and mining group, the positive effect with motion of low value-added growth regime to high value-added growth regime is increased. also in value-added growth of transportation storage and communications group, the positive effect for both regimes are great.

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Journal of Applied Economics Studies in Iran
Volume 5, Issue 19
November 2016
Pages 83-107

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