The Asymmetric Effects of Energy Consumption on Growth of Iran's Agricultural Sector Using Non-Linear Extended Lag Self-Regression (NARDL)

Energy is one of the factors used in most economic activities. The economic security of most countries depends on secure access to energy. Therefore, the production and consumption of energy and its optimal use are of particular importance. The purpose of this study is to investigate the relationship between energy consumption and economic growth in the framework of nonlinear self-regression with extended interruptions (NARDL). We use seasonal data for the period 2002-2018 to investigate the asymmetric relationship between the chosen variables. The results indicate that a positive long-term shock on energy consumption had a positive effect on growth of the agricultural sector. A one percent increase or decrease in energy consumption increases economic growth in the agricultural sector by 0.8539 and 0.9657 percent, respectively. Also, the results of asymmetric causality test between energy consumption and growth of agricultural sector indicate that there is a symmetric causal relationship between energy consumption and growth of the agricultural sector.  There is a positive asymmetric causal relationship between positive energy consumption shocks and agricultural growth, and no asymmetric causal relationship between negative shocks to energy consumption and growth of the agricultural sector. Therefore, policymakers need to attract new capital to build new power plants in the country, so that they can accelerate energy production and ensure the energy needed for agriculture.