The relationship between economic growth, international trade and energy efficiency in European countries : an Autoregressive Distributed Lag (ARDL) modeling approach

In order to analyze the nature of relationship among time series represented economic growth, international trade and energy efficiency of 38 European countries for the period from 1995 to 2022 we employed the ARDL model. We identified bidirectional long-term causal relationships between energy intensity and GDP growth rates, as well as between carbon dioxide emissions intensity, GDP per capita and the proportion of exports in GDP. The analysis showed that over the long term, enhancing the energy intensity contributes to an increase in their rate of economic growth. However, in the short term, energy intensity have a negative impact on the GDP growth. Policymakers can use the paper's findings to design policies that balance benefits of reducing energy intensity with sustainable growth. [Publisher's Text]