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The connection between urbanization and carbon emissions: a panel evidence from West Africa

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Abstract

This study examined the nexus between urbanization and carbon emissions in West Africa. Second-generation econometric techniques that are robust to cross-sectional dependence and slope heterogeneity were used for the study. From the Pesaran–Yamagata homogeneity test, the slope coefficients were heterogeneous in nature. Also, the Breusch–Pagan LM test, the Pesaran scaled LM test, bias-corrected LM test, Pesaran CD test and the Friedman’s test confirmed the studied panels to be cross-sectionally dependent. Further, the CADF and the CIPS unit root tests established the variables to be first-differenced stationary. Additionally, the Westerlund and Edgerton bootstrap cointegration test and the Pedroni residual cointegration test affirmed the series to be cointegrated in the long run. The Driscoll–Kraay standard errors regression estimator was employed to examine the long-run equilibrium relationship amid the series, and from the results, urbanization had a significantly positive influence on CO2 emissions in all the three panels. Also, economic growth had a materially positive effect on CO2 emissions, while renewable energy consumption had a substantially negative impact on CO2 emissions in all the panels. The causal connections amid the series were finally explored through the Dumitrescu–Hurlin panel causality test, and the discoveries were a bit varied across the various panels. Policy recommendations are further discussed.

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Abbreviations

RE:

Renewable energy

REC:

Renewable energy consumption

EC:

Energy consumption

ED:

Environmental degradation

POP:

Population

URB:

Urbanization

FDI:

Foreign direct investments

FD:

Financial development

LI:

Low-income countries

LMI:

Low–middle-income countries

GDP:

Economic growth

CO2 :

Carbon emissions

MENA:

Middle East and North Africa

OECD:

Organisation for Economic Co-operation and Development

EU:

European Union

USA:

United States of America

UAE:

United Arab Emirates

OVB:

Omitted variable bias

BRICS:

Brazil, Russia, India, China and South Africa

VIF:

Variance inflation factor

WDI:

World development indicators

CLRM:

Classical linear regression model

CD:

Cross-sectional dependence

LM:

Lagrangian multiplier

CADF:

Cross-sectionally augmented Dickey–Fuller

CIPS:

Cross-sectional Im, Pesaran and Shin

ARDL:

Autoregressive-distributed Lag

STIRPAT:

Stochastic impacts by regression on population, affluence and technology

GHGs:

Greenhouse gases

SSA:

Sub-saharan Africa

ASEAN:

Association of Southeast Asian nations

OLS:

Ordinary least squares

WA:

West Africa/West African

NRE:

Nonrenewable energy

NREC:

Nonrenewable energy consumption

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Funding

This study was funded by the Nature Fund 2020 (Project Approval Number: 71973054).

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Authors and Affiliations

  1. School of Finance and Economics, Jiangsu University, Zhenjiang, People’s Republic of China

    Mohammed Musah, Yusheng Kong, Stephen Kwadwo Antwi & Mary Donkor

  2. Institute of Applied Systems Analysis (IASA), School of Mathematics, Jiangsu University, Zhenjiang, People’s Republic of China

    Isaac Adjei Mensah

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  1. Mohammed Musah
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  2. Yusheng Kong
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  3. Isaac Adjei Mensah
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MM wrote the original draft. YK supervised the study. IAM analyzed the data and revised the manuscript. SKA designed the study and revised the final manuscript. MD contributed data and analytical tools.

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Correspondence to Mohammed Musah.

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Musah, M., Kong, Y., Mensah, I.A. et al. The connection between urbanization and carbon emissions: a panel evidence from West Africa. Environ Dev Sustain 23, 11525–11552 (2021). https://doi.org/10.1007/s10668-020-01124-y

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