Comparing the asymmetric efficiency of dirty and clean energy markets pre and during COVID-19

Muhammad Abubakr Naeem, Sitara Karim, Saqib Farid, Aviral Kumar Tiwari

Research output: Contribution to journalArticlepeer-review

32 Citations (Scopus)

Abstract

In the backdrop of the recent COVID-19 pandemic, the study examines the comparative asymmetric efficiency of dirty and clean energy markets pre and during the COVID-19 pandemic. For this purpose, we utilize an asymmetric multifractality detrended fluctuation analysis (A-MF-DFA). The study's findings uncover the presence of asymmetric multifractality in clean and dirty energy markets. In addition, multifractality in the energy markets is sensitive to trends, time horizon and major events. More importantly, the results suggest superior efficiency of clean-energy markets compared to conventional energies. We confirm the time-varying nature of market efficiency in the energy markets, and during the recent COVID-19 outbreak, market inefficiencies in the clean and dirty energy markets soared. In this way, the study holds meaningful insights for policymakers, energy policy practitioners, investors, and financial market participants to choose between clean (dirty) investments based on their asymmetric efficiency (inefficiency).

Original languageEnglish
Pages (from-to)548-562
Number of pages15
JournalEconomic Analysis and Policy
Volume75
DOIs
Publication statusPublished - Sept 2022

Keywords

  • Asymmetric multifractality
  • COVID-19 pandemic
  • Clean energy sector
  • Crisis periods
  • Energy markets

ASJC Scopus subject areas

  • Economics and Econometrics

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