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Financial development and carbon dioxide emissions in Nigeria: evidence from the ARDL bounds approach

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Abstract

This study examines the dynamic impact of financial development, energy consumption, trade openness, and economic growth on carbon dioxide (CO2) emissions in Nigeria. We applied autoregressive distributed lag bound testing technique for the period of 1971–2010. The empirical result shows a long-run cointegration relationship among the variables. The long-run estimation result, however, reveals that, economic growth, development of the financial sector and energy consumption have a positive and significant impact on carbon dioxide emissions, whereas trade openness has negative and significant impact on carbon dioxide emissions. The finding suggest that the government should emphasize programs and policies that reduce carbon dioxide emissions by opening the trade sector considering the roles such openness plays in reducing environmental degradation in the country, which directly enhances environmental quality.

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Notes

  1. Details on EIA can be accessed at: http://www.eoearth.org/view/article/152513/.

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Acknowledgements

All the papers cited in this manuscript are fully acknowledged.

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Authors and Affiliations

  1. Department of Economics, Faculty of Social Sciences, Ahmadu Bello University Zaria, 1044, Zaria, Nigeria

    Hamisu Sadi Ali

  2. Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia, 43400, Serdang, Selangor, Malaysia

    Siong Hook Law, Zulkornain Yusop, Lee Chin & Uweis Abdulahi Ali Bare

  3. Department of Management and Marketing, Faculty of Economics and Management, Universiti Putra Malaysia, 43400, Serdang, Selangor, Malaysia

    Woon Leong Lin

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  1. Hamisu Sadi Ali
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Correspondence to Hamisu Sadi Ali.

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Ali, H.S., Law, S.H., Lin, W.L. et al. Financial development and carbon dioxide emissions in Nigeria: evidence from the ARDL bounds approach. GeoJournal 84, 641–655 (2019). https://doi.org/10.1007/s10708-018-9880-5

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