Agricultural land usage and tourism impact on renewable energy consumption among Coastline Mediterranean Countries

Abstract

This empirical study aims to investigate the dynamic response of renewable energy consumption to long-run disequilibrium and short-run impact of tourism development and agricultural land usage for the period of 1995 to 2014 in 16 Coastline Mediterranean Countries. For this reason, a dynamic Autoregressive Distributed Lag approach is employed in a multivariate and two-model framework such that carbon emission and gross domestic product are being controlled for in the models. Significantly, there is evidence of a joint impact of tourism development and agricultural land usage on renewable energy consumption. With a speed of adjustment of 21.6% from short-run disequilibrium to long run, their respective panel elasticities are 0.33 and negative 1.60 in the long run. Significant evidence shows that nine of the Coastline Mediterranean Countries have tourism development as a short-run factor while Slovenia and Cyprus exhibit a short-run common factor. Also, Granger causality evidences from carbon emission, gross domestic product and tourism development to renewable energy are all with feedbacks. However, Granger causality from agricultural land usage to renewable energy is without feedback. In the region, effective policy implementations through the collaborative effort of stakeholders will ensure a sustainable renewable energy development amidst agricultural and tourism activities.