Abstract
This study examines the effect of urbanization, income, trade openness, and institutional quality (i.e., regime type and durability) on environmental degradation in Ghana over the period 1965–2011. Using the bounds test approach to cointegration and the Fully Modified Phillip-Hansen (FMPH) technique, the findings show that urbanization, income, trade openness, and institutional quality have long-run cointegration with environmental degradation. Further, the results show that income, trade openness, and institutional quality are negatively associated with environmental degradation. This suggests that income, trade openness, and institutional quality enhance environmental performance. Urbanization, however, is positively related to environmental degradation. Additionally, long-run estimates conditioned on institutional quality reveal that the extent to which trade openness and urbanization enhance environmental performance is largely due to the presence of quality institutions (or democratic institutions). Finally, controlling for structural breaks, we find that trade openness, urbanization, and regime type (i.e., democracy) improve environmental performance significantly after the 1970s except for income.
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Notes
Readers interested in the full description of the FMPH method should see the original article by Phillips and Hansen (1990).
We do not take the natural logarithm of Institutional quality because it takes on non-positive integers.
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Adams, S., Adom, P.K. & Klobodu, E.K.M. Urbanization, regime type and durability, and environmental degradation in Ghana. Environ Sci Pollut Res 23, 23825–23839 (2016). https://doi.org/10.1007/s11356-016-7513-4
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DOI: https://doi.org/10.1007/s11356-016-7513-4