The nexus between urbanization, road infrastructure, and transport energy demand: empirical evidence from Pakistan

Transport sector of Pakistan contributes more than one half to the national energy consumption. This sector is dominated by road transportation and mainly relies on fossil fuels. The country is going through rapid unplanned urbanization, which can lead to detrimental health and ecological consequences by intensifying road transport energy consumption. Therefore, the current study investigates the effect of urbanization on road sector energy consumption controlling for economic growth, road infrastructure, and industrialization. The autoregressive distributed lag (ARDL) approach is used to examine the long-run and short-run relationship between variables over the period 1971 to 2018. The vector error correction model (VECM) is employed to analyze the causality between variables. The results disclose a significant positive contribution of urbanization to road sector energy consumption. Further, road infrastructure, economic growth, and industrialization stimulate road transport energy consumption. Feedback effect exists between urbanization and road transport energy consumption, while economic growth Granger causes road sector energy consumption, urbanization, and road infrastructure. The findings imply that energy conservation and sustainable urbanization policies are a better choice under the current economic situation. Also, road infrastructure development in rural areas may reduce rural to urban migration.