Application of Cointegration Test Model to Economy Growth and Energy Consumption in China

The paper takes data of GDP and energy consumption in period 1953-2007 as a sample,and makes an empirical study on long-term interaction and short-term dynamics between GDP and energy consumption with application of cointegration test,granger causality tests and ECM in aim of uncovering the interrelationship between economic growth and engegy production as well as energy consumption.The test results indicate the long-term dynamic interaction between GDP growth and energy consumption.In addition,energy production and consumption are the Granger cause of GDP,and energy consumtion is the Granger cause of energy production.In analysis of the tests,the dependence of GDP growth on energy supply was defined.