Background: Energy demand, as a lubricant engine of economic growth, is growth. Energy-based economic growth, in addition to creating unsustainable economic growth, can threaten energy security and increase global warming, because energy plays a major role in carbon dioxide emissions. The best way to achieve sustainable economic growth and environmental protection is to rely on the total factor productivity growth and human capital. Aim: The main purpose of this study is to investigate the mutual relationship between energy consumption, human capital and total factor productivity growth in the Persian Gulf countries1during the years 2000-2017.
Methodology: In this study, first, the total factor productivity growth was calculated using the data envelopment analysis approach and the Luenberger productivity index. Then, with the help of econometric techniques, the long-term relationship and direction of causality
between the total factor productivity growth, energy consumption and human capital were investigated.
Findings: Iraq (0.95) and Kuwait (0.84) had the highest and the UAE (0.60) and Iran (0.37) had the lowest average total factor productivity growth. The results indicated a strong cointegration and a long-term relationship between energy consumption, human capital and total factor productivity growth. This study showed that a 1% increase in energy consumption reduces the total factor productivity growth by 2.23%; Whereas, a 1% increase in human capital increases the total factor productivity growth by 1.92%. In addition, the Granger causality results of the panel supported the long-term feedback hypothesis, while in the short run only a one-way causal relationship from human capital to energy consumption was observed.
Conclusions: Whereas the findings of this study supported the long-term feedback hypothesis and showed that energy consumption reduces total factor productivity growth while human capital increases total factor productivity growth; Therefore, the