Energy conservation policies may harm real income growth, impacting domestic inflation.
The study looked at how changes in energy use, real income growth, and prices are connected in Turkey. By analyzing different types of energy consumption, the researchers found that industrial energy use has a big impact on domestic inflation. They also discovered a long-term relationship between these factors, especially when looking at industrial energy use. The study suggests that energy policies can greatly affect inflation rates. Interestingly, conserving energy in industries might actually hurt real income growth, but this isn't the case for residential and commercial energy use.