The economic growth-environmental sustainability nexus in developing countries: Some evidence from Sub Sahara Africa
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Date
2015-04-17
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University of Ghana
Abstract
Ensuring environmental sustainability amidst the quest to stimulate
growth in SSA remains an issue of great concern and therefore considered
extremely important in contemporary growth agenda in many
developing countries. Notwithstanding these, the evidence for SSA
remains very sparse, as literature has not adequately examined the
effects of SSA's economic growth process on environment
sustainability in the region. Using a panel dataset from 1980-2010
covering 28 SSA countries and employing environmental pollution,
degradation and sustainability indices, this study examines the
environmental impact of economic growth within the standard
Environmental Kuznet Curve (EKC) framework. Estimation by the
system Generalized Method of Moment confirmed the existence of the
Environmental Kuznet Curve (EKC) hypothesis for environmental
sustainability and degradation measured respectively by Adjusted
Net Savings and energy consumption but was not confirmed for
environmental pollution as the findings were not supported by data
on C02 e missions. Additionally, greater openness to trade was
associated with a fall in both pollution and environment sustainability
but for urbanization the contrary was found to exist. Furthermore,
industrialization was also found to unambiguously harm the environment
while the converse was established for FDI. These findings have
stern theoretical and policy implications for the economic growth-environmental
sustainability nexus in SSA and further cast doubts on
validity of the EKC for C02 especially for SSA. Following this evidence
we discuss some policy options
Description
School of social sciences colloquium
Keywords
Kuznet Curve (EKC), energy consumption, industrialization, policy implications