The economic growth, electricity consumption and employment causality: evidence from Zambia

In this study, the causal relationship between electricity consumption, economic growth, and employment for Zambia from 1974 to 2016 is examined using the cointegration techniques, Vector Error Correction Model (VECM) and Impulse Response Function (IRF). From our trivariate model, our results establish with new evidence the existence of cointegration amongst the variables. The results indicate the presence of a long-run cointegration relationship between economic growth, employment rate and electricity consumption in Zambia. Additionally, a neutrality causality exists between economic growth and electricity consumption and between economic growth and employment. Also, there is a long-run unidirectional causality running from employment rate to electricity consumption per capita (KWh) and no feedback.