An econometric investigation of the effect of financial development on aggregate, and disaggregate energy consumption: time series assessment for Ghana

The paper has examined both long run and short run link between financial development and energy consumption in Ghana for 1970-2011 period using Autoregressive Distributed Lad Model. The ARDL test results produced significant evidence of cointegration among the variables. There are statistical significant long run and short run effects of financial development on energy consumption. The results seem to suggest that financial development is a key explanatory variable in energy consumption and as such, financial development could be relied on as a policy tool to manage energy consumption. Future research should account for the effect of structural effect and the issues of causality.