Does Education Spending Affect Energy Consumption in Saudi Arabia? A Bootstrap Causality Test

Abstract

This investigation explores the causal nexus between educational expenditure and energy utilization in Saudi Arabia spanning 1981-2023, thereby addressing a significant deficiency in the academic discourse concerning the direct influence of educational investments on energy consumption patterns. Through a bootstrap causality examination framed by an Autoregressive Distributed Lag (ARDL) approach, this investigation delves into yearly time series data to highlight educational investment’s immediate and delayed effects on energy consumption. The results indicate that educational spending exerts a lagged yet positive influence on energy consumption, which materializes over time as the populace attains greater technological literacy and industrial operations proliferate. This lagged effect emphasizes the critical nature of long-term educational investments in fostering sustainable energy consumption behaviors, which aligns with Saudi Arabia’s Vision 2030 objectives regarding economic diversification and ecological sustainability. Also, this investigation validates the premise that economic development and oil price volatility have substantial positive repercussions for energy consumption, emphasizing the energy-intensive traits of the Saudi economic landscape and its reliance on oil-related earnings. Additionally, population growth contributes to the escalation of energy consumption, while the ramifications of urbanization remain statistically negligible in the short run. These findings hold substantial implications for policymakers, suggesting that persistent investment in educational frameworks is imperative for attaining enduring energy efficiency and sustainability objectives. The research advocates that enhancing energy literacy and promoting technological advancement through education can facilitate the transition toward a sustainable energy paradigm.