Are fluctuations in energy consumption per capita transitory? Evidence from a panel of Pacific Island countries

This study applies the panel stationarity test developed by [Carrion-i-Silvestre et al 2005. Breaking the panels: An application to GDP per capita. Econometrics journal 8, 159-175] to examine the stationarity of energy consumption per capita for a panel of 13 Pacific Island countries over the period 1980-2005. This test has the advantage that it allows for multiple structural breaks at unknown dates that can differ across countries and can account for all forms of cross-sectional correlation between countries. The conclusion from the study is that energy consumption per capita in approximately 60% of countries is stationary and that energy consumption per capita for the panel as a whole is stationary. The study offers several suggestions for modelling energy consumption and policy-making in the Pacific Islands. (C) 2009 Elsevier Ltd. All rights reserved.