Unit Root Properties of Energy Consumption and Production in Turkey
2013
In this study, unit root properties of total and sectorial energy production and consumption
series of Turkey are investigated. This study is the first to investigate unit root properties of
Turkish energy production. The unit root null hypothesis for energy variables are tested by
using unit root tests based on LM considering without structural break and with one and two
structural breaks. The results of the unit root test without structural break show that the unit
root hypothesis is rejected only for consumption of natural gas. The unit root hypothesis is rejected for 15 out of the 33 series by the LS test with one structural break. When two
structural breaks are taken into account, 25 out of the 33 series are found to be stationary
around a deterministic trend. The production of hydraulic and the consumption of lignite,
electricity, petroleum, coal and electricity, total energy and petroleum consumption in
Transportation sector are found to be non-stationary, which indicates that the impacts of
innovations on these variables will be permanent. The policy implication of the results
suggests that the impacts of shocks on energy consumption and production will be temporary
and not have a long memory for most of variables.
Keywords: unit root, energy production, energy consumption, structural break, Turkey
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