The effect of sectoral electricity comsumption on sectoral value added

This paper aims to investigate the effect of sectoral electricity consumption on sectoral value added in Turkish manufacture industries which are classified according to economic activities in the Turkish economy for the 1994?2001 period by using panel data analyse. These sectors are gathered into five groups. These groups are called that, (1)food, beverage and tabacco industries, (2)textile, wearing appared and leather industries (3) chemical, coal, rubber and plastic products industries (4) non-metallic mineral product industries (5) fabricated metal products, machinery and transportation vehicle, scientific and Professional measuring and controlling equipment industries. Sectoral electricity consumption and sectoral value added variables are tested by using panel unit root tests proposed by Maddala and Wu (1999) and Choi (2001). The results suggest that sectoral electricity consumption and sectoral value added are integrate of order one (I(1)). Each variable is integrated of order one, for long-run relationship between sectoral electricity consumption and sectoral value added in Turkey, we tested for panel cointegration using the test of Pedroni (1995,1999) and Kao (1999) test. Our finding suggest that, in the case of Turkey, there is a no evidence of panel cointegration in the long run between sectoral electricity consumption and sectoral value added in 1994?2001 period.Key words: Sectoral Electricity Consumption, Sectoral Value Added, Panel Unit Root Test, Panel Cointegration.