Income inequality, human capital, natural resource abundance, and ecological footprint in ECOWAS member countries

Abstract

The growing human demand for economic and social development is resulting in a state of ecological overshoot. This paper investigates the heterogeneous effect of income inequality, human capital, and natural resources on the ecological footprint for the Economic Community of West African States (ECOWAS) member countries. Having accounted for cross-sectional dependence and slope heterogeneity, the findings from the Augmented mean group (AMG) estimation reveal that income inequality improves the quality of the environment in Burkina Faso, Nigeria, and Senegal, but deteriorates the environment in Benin. Moreover, human capital accumulation is important for environmental sustainability by exerting a reducing effect on the level of the ecological footprint for Burkina Faso and The Gambia. We further observe that natural resource abundance is not environmentally friendly for Cameroon and Nigeria. Evidence from the Dumitrescu and Hurlin (D-H) panel causality test shows that LGINI, LHC, and LNR stimulate the ecological footprint. Some policy recommendations are offered based on these findings.