The economic growth and electricity consumption nexus: Evidence from Mauritius

This paper has tried to unfold the causal relationship between electricity consumption and real economic growth in Mauritius using co-integration models applied to time series data between 1961 and 2011. The results unambiguously show that there is a short-term unidirectional causality from electricity consumption towards economic growth. Therefore GDP growth depends on electricity consumption. The implications of this distinct causal relationship between the two variables on the formulation of policies for the power sector are discussed.