Dynamic Model for the Consumption of Electrical Energy in Indonesia

Sudati Nur Safiah, Rr. Retno Sugiharti, Rian Destiningsih, Putra Arif Budiman

Abstract


This study aims to find the existence of a long-term relationship between subsidized energy, population, inflation, economic growth, and consumption of electrical energy in Indonesia for the period of 1987-2018. In order to analyse the existence of long run relationship, this research was conducted using the Autoregressive Distributed Lag (ARDL) model. This research focused on the energy subsidy, considering that Indonesia is one of the four countries that still apply subsidized energy. The findings suggest that that there is a long-term cointegration between electricity consumption with regressor variables. The result of Estimation Result of ARDL also confirms the existence of long-term relationships on variables in the model.

Keywords: energy consumption, electricity, economic growth, Indonesia

JEL Classifications: Q01, L94, C38

DOI: https://doi.org/10.32479/ijeep.11376


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