Abstract—Within a country in the current globalized world,
there is being an immense increase in energy demand due to a
rapidly growing economy, changing living standards,
population growth and rapid urbanization. Although the
subject of some noteworthy studies has been on the energy
policies, there are not so many of them focused on the
correlation between energy demand and the budget deficit.
Considering the researches ever made, mostly for developing
countries, it is derived that the level of energy demand exceeds
the level of energy supply.
In the countries where there exists limited energy production
capacity as well as, adversely, a huge growth of energy demand,
that has resulted in dependency on high-cost energy resources
or energy imports. However, these countries are diversified
from each other with varying degrees of budget balances,
supply-demand relations, or underground energy base. In this
study, we aim to focus on the relationship between budget
deficit and energy demand in some European countries and
Turkey within the years of 1960-2013. In order to determine
that relationship, panel causality test, panel unit root tests, and
panel cointegration analysis are used in terms of methodological
framework.
Index Terms—Budget deficit, energy demand, European
countries, panel unit root test, panel ARDL cointegration, panel
causality.
Zerife Yildirim and Ayşe Atilgan Yaşa are with the Dokuz Eylül
University, Turkey (e-mail: {zerifeyildirim, a_atilgan45}@hotmail.com).
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Cite: Zerife Yildirim and Ayşe Atilgan Yaşa, "The Relation between the Budget Deficit and Energy Demand in the Selected European Countries and Turkey: Panel Cointegration Analysis," International Journal of Trade, Economics and Finance vol.5, no.6, pp. 482-489, 2014.