Abstract:
Looking at the recent nuclear accident in Fukushima, Japan, the consequences were not just environmental
or economic. The accident was a big hit to the reputation and trust in nuclear power generation
making a number of countries reconsider the nuclear energy as an option. The recent financial crisis
might have limited even more the developed countries from the necessary capital to invest in expensive
power options but this might change in the future if the positive environmental effects of the nuclear
power can be proven substantial. The purpose of this paper is to analyse the causal link between nuclear
energy consumption and economic growth for six developed countries over the period from 1971 to
2011. Granger causality procedure based on Meta-analysis in heterogeneous mixed panels is used to
allow for cross-sectional dependency and heterogeneity across countries. The empirical findings for the
overall panel support the presence of unidirectional causality running from economic growth to nuclear
energy consumption across the G-6 countries. However, in the case of UK we find a bidirectional causality
running from nuclear energy consumption to economic growth; while the results for Germany
confirm the growth hypothesis and for the rest of the countries the neutrality hypothesis.
