Growth Thresholds and Environmental Degradation in Sub-Saharan African Countries: An Exploration of Kuznets Hypothesis

Document Type: Original Research

Authors

1 Department of Economics, Al-Hikmah University, Ilorin, Nigeria

2 School of Economics, Universiti Kebangsaan Malaysia (UKM), Malaysia

Abstract

This study investigates the presence of environmental Kuznets curve (non-linear relationship between pollution and the per capita income) in Nigeria, Ghana, Cote d’Ivoire, Mali and Senegal and Gabon. In the study, pollution is regressed on per capita income, squared per capita income, trade intensity, foreign direct investment and population density price. Panel estimation technique and ordinary least square were used to obtain required estimates for all selected countries and individual economies. The study established the presence of environmental Kuznets curve for these countries at group and individual level. It also revealed that the value of turning point in pollution level corresponding to per capita income is varying among countries. From the result, the threshold GDP per capita (constant 2005 US$) is approximately $758 for Nigeria, $7060 for Gabon, $585 for Ghana, $1014 for Cote d’Ivoire, $390 for Mali and  $675 for Senegal. The declining trend of pollution with regards per capita income could be attributed to introduction of environmental friendly products, structural changes in the industrial sector of these countries that involve more output per primary resources.

Keywords


Abdulai, A. and Ramcke, L. (2009).The Impact of trade and Economic Growth on the Environment: Revisiting the Cross-Country Evidence. Kiel Working Paper No. 1491.  
Aggarwal, A. (2001). ‘The Value of Natural Capital’. Development Outreach. Winter Issue. Washington, DC: World Bank.
Aliyu, M. A. (2005), ‘Foreign direct investment and the environment: pollution havens hypothesis revisited’, Annual Conference on Global Economic Analysis, Germany.
Angela, C., Paulo, F. and Pedro, C. (2003). A new environmental Kuznets curve? Relationship between direct material input and income per capita: evidence from industrialized countries. Ecological Economics 46: 217- 229
Antweiler, W., Copeland, B.R. and Taylor, M.S. (2001).Is Free Trade Good for the Environment? The American Economic Review 91(4): 877-908.
Ashraf, M. A., Maah, M. J., Yusoff, I. and Mehmood, K. (2010). Effects of Polluted Water Irrigation on Environment and Health of People in Jamber, District Kasur, Pakistan, International Journal of Basic & Applied Sciences, 10(3): 37-57.
Cole, M. A. (2004). Trade, the pollution heaven hypothesis and the environmental Kuznets curve: examining the linkages. Ecological Economics 48: 71- 81
Cole, M. A., Rayner, A. J., & Bates, J. M. (1997). The environmental Kuznets curve: An empirical analysis. Environment and Development Economics, 2(4): 401– 416.
Copeland, B.R. and Taylor, M.S. (2004). Trade, Growth, and the Environment. Journal of Economic Literature 42: 7-71.
Ekins, P., (1997).The Kuznets curve for the environment and economic growth: examining the evidence. Environment and Planning, 29: 805-830.
Feridun, M., Folorunsho, S.A., and Jean, B. (2006). Impact of Trade Liberalisation on the Environment in Developing Countries: The case of Nigeria, MPRA paper No 731.
Grossman, G. M., and Krueger, A. B. (1991). Environmental impacts of a North American Free Trade Agreement. National Bureau of Economic Research Working Paper 3914, NBER, Cambridge MA.
 Grossman, G. M., and Krueger, A. B. (1995). Economic growth and the environment, Quarterly Journal of Economics, 112, 353-377
Grossman, G.M. and Krueger, A.B. (1993).Environmental Impacts of a North American Free Trade Agreement. The Mexico-U.S. Free Trade Agreement, edited by P. Garber. Cambridge, MA: MIT Press.
Jänicke, M., Binder, M., and  Mönch, H. (1997). ‘Dirty Industries’: Patterns of Change in Industrial Countries. Environmental and Resource Economics, 9: 467-491.
List, J. A., and Gallet, C. A. (1999). The environmental Kuznets curve: Does one size fit all? Ecological Economics, 31: 409–424.
Lopez, R. (1994). The Environment as a Factor of Production: the Effects of Economic Growth and Trade Liberalization, Journal of Environmental Economics and Management 27: 163-184.
Machado, G.V. (2000), ‘Energy Use Co2 emission and Foreign Trade: An Input –Output Approach Applied to the Brazilian Case’. Paper Presented at the 13th Conference on Input-Output Technique, Italy 21st -25th.
Mani, M., and Wheeler, D. (1998). In search of pollution havens? Dirty industry in the world economy, 1960–1995. Journal of Environment and Development 7(3): 215-247.
McCarney, G. and Adamowicz, V. (2006). The Effects of Trade Liberalization on theEnvironment: An Empirical Study, Contributed Paper prepared for presentation at the 26th Conference of the International Association of Agricultural Economists, Gold Coast, Australia, August 12-18, 2006.
Muftau, O., Iyoboyi, M. and Ademola, A. (2014), An Empirical Analysis of the Relationship between CO2 Emission and Economic Growth in West Africa, American Journal of Economics, 4(1): 1-17
OECD (2004). Key Environmental Indicators 2004, Organisation of Economic Cooperation and Development. http://www.oecd.org/env/indicators-modelling-outlooks/31558547.pdf
Qureshi, M.S. (2006). Trade Liberalization, Environment and Poverty: A Developing Country Perspective. UNU-WIDER Research Paper No. 2006/45
Stern, D., and Common, M. S. (2001). Is there an Environmental Kuznets curve for sulfur? Journal of Environmental Economics and Management, 41(2), pp. 162-78
Stern, D.I (2003), ‘The Environmental Kuznets Curve’, International Society of Ecological Economics
World Development Indicators Online Database (2014). World Bank website:  http://www.worldbank.org/data/onlinedatabases/onlinedatabases.html.