The role of current account deficit in relationship between energy consumption and economic growth: Turkey and BRICS countries

In this study, the role of the sustainable current account deficit in the relationship between energy consumption and economic growth was examined in Turkey and BRICS countries in 1995-2017 period. In this direction , Smooth Transition Regression model is used. The results indicate that threshold level of Current Account Deficit is %5.6 in Turkey and BRICS countries. If the current account deficit is below the threshold level, the increase in energy consumption effects economic growth positively ,on the other hand ,above the threshold level exist of current deficit effect economic growth negatively. In this situation, policy makers should be careful about the fact that current deficit must be actualised in this level or below of it in order to carry out the sustainable positive growth in Turkey and BRICS countries whose production is dependent on importation and biggest share of importation is energy. In addition, energy policies should be followed as which is redirecting to renewable alternative energy sources and giving priority to domestic resources.