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The impact of financial development and foreign direct investment on environmental sustainability in Sub-Saharan Africa: using PMG-ARDL approach.
- Source :
- Economic Research-Ekonomska Istrazivanja; 2023, Vol. 36 Issue 2, p1-23, 23p
- Publication Year :
- 2023
-
Abstract
- This study is aimed at establishing the impact of foreign direct investment and financial development on carbon dioxide emission and clean energy using 44 countries in sub-Saharan Africa ranging from 1998 to 2017. Employing a second generation unit root test in conjunction with Pooled Mean Group, the study established that financial development have significant positive impact on clean energy consumption in sub-Saharan Africa. This was found to be consistent in both low-income and middle-income countries in sub-Saharan Africa. Financial development is however found to be significantly negative with carbon dioxide in sub-Saharan Africa and middle-income countries. This relationship is only positive in the low-income countries. Foreign direct investment does not have any significant impact on clean energy consumption in sub-Saharan Africa. A significant impact is noted after the decomposition of the sample into low-income and high-income countries. In low-income countries, foreign direct investment inflows impact positively on clean energy consumption. This relationship is however negative with middle-income countries. The link between foreign direct investment and carbon dioxide is significantly positive in the whole sample and also in low-income countries. These long-run relationships have been confirmed by the causality test. [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 1331677X
- Volume :
- 36
- Issue :
- 2
- Database :
- Complementary Index
- Journal :
- Economic Research-Ekonomska Istrazivanja
- Publication Type :
- Academic Journal
- Accession number :
- 175301898
- Full Text :
- https://doi.org/10.1080/1331677X.2022.2106270