Effects of Energy Efficiency Index on Economic Activity: The Case of G7 Countries

This investigation aims to examine the effects of energy efficiency improvements on economic growth for G7 countries during 1971-2018. To measure efficiency, we calculate index (EEI) using Fisher Ideal decomposition method. study utilizes capital and labor as control variables, in addition EEI variable, determinants growth. Methodologically, this paper conducts LM (Lagrange Multiplier) bootstrap panel cointegration test which is developed by Westerlund ve Edgerton (2007), AMG (Augmented Mean Group) estimator Eberhardt Teal (2010). Both methodologies take into consideration cross-sectional dependency (CD) issue setting. The empirical results indicate that there a relationship between aforementioned variables. In detail, impact formation positive all countries, while effect varies across countries. Besides, it found an improvement leads advancement five out seven findings provide some implications policymakers.