Causal relationship between nuclear energy consumption and economic growth in the G6 countries: Evidence from panel Granger causality tests

This paper analyses the causal linkages between nuclear energy consumption and economic growth for a panel of six developed countries including Canada, France, Germany, Japan, the UK and the US. Using annual data from 1971 to 2011, a Granger causality procedure based on meta-analysis in heterogeneous mixed panels is used to allow for cross-sectional dependence and heterogeneity across countries. Consistent with the conservation hypothesis, empirical results provide evidence of a unidirectional causality running from economic growth to nuclear energy consumption across the G-6 countries. This suggests that energy policy geared towards a reduction in nuclear energy consumption may not adversely impact economic growth. This finding corroborates the individual country results, except for the UK, for which support is obtained for the existence of a bidirectional causality between the two variables.