ANALYSIS THE RELATIONSHIP BETWEEN GASOLINE CONSUMPTION AND ECONOMIC GROWTH THE CASE OF LIBYA

Abstract

This paper aims to analyze and describe the relationship between gasoline consumption and economic growth in Libya by investigated the excessive of gasoline consumption which is considered as one of the constraints to development. We e adopted gross domestic product and gasoline Consumption as model’s variables, while these variables consider as one of the macroeconomic indicators while the price of gasoline are subsidized by government. The paper proposes a methodology for modeling, by using annual date for the period 1995-2018 and tools of different econometric techniques that that appropriate to data conditions .we use Unit Root Test and ARDL Approach and the result showed that there's positive and statistically significant relationship in the long-term between GDP and gasoline consumption and a correction from the short term to the long term quickly (0.325), which means that it is taking place return to equilibrium within one year after the impact of any shock in the model as a result of a change in the GDP.