Causal Relationship between Nuclear Energy Consumption and Economic Growth and its Significance to Public Policy in China

This paper uses econometrics techniques to examine the short- and long-run causality issues between nuclear energy consumption and economic growth in China. It employs annual data covering the period 1993-2007. Tests for unit roots, co-integration, and Granger-causality based on error-correction model are presented. The results show there is a long equilibrium relationship between nuclear energy consumption and economic growth. A unidirectional causality run is found from nuclear energy consumption to economic growth without any feedback effect. This study has a good significance to public policy. In order not to affect economic growth, the Chinese government should take many measures to develop nuclear energy.