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Dynamic Effect of Oil Resources on Environmental Quality: Testing the Environmental Kuznets Curve Hypothesis for Selected African Countries

Author

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  • Mohamed Ouédraogo

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Daiyan Peng

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Xi Chen

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Shujahat Haider Hashmi

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Mamoudou Ibrahima Sall

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

Abstract

This paper examines the environmental Kuznets curve (EKC) theory, augmenting the role of oil resources and energy consumption in carbon dioxide (CO 2 ) emissions using the annual data of 11 African oil-producing countries from 1980 to 2014. We apply advanced panel cointegration and panel autoregressive distributive lag (ARDL) techniques coupled with Granger non-causality analysis to account for cross-sectional dependence and heterogeneity. The results of the augmented mean group (AMG) reveal that oil resources abundance degrades the environmental quality in Angola while abating CO 2 emissions in Algeria, Gabon, Morocco, and Nigeria. Contrarily, energy consumption escalates pollution in the Congo Democratic Republic (COD), Côte d’Ivoire (CIV), Gabon, Morocco, and Tunisia. Our findings support the EKC hypothesis only in Cameroon, CIV, and Nigeria while exhibiting a U-shaped curve in Algeria and Morocco. Causality analysis unveils that oil resources Granger cause energy consumption, suggesting the balance between renewable and non-renewable energy sources. The current study has important policy implications for promoting green technology, economic diversification, service sector, and green investments.

Suggested Citation

  • Mohamed Ouédraogo & Daiyan Peng & Xi Chen & Shujahat Haider Hashmi & Mamoudou Ibrahima Sall, 2021. "Dynamic Effect of Oil Resources on Environmental Quality: Testing the Environmental Kuznets Curve Hypothesis for Selected African Countries," Sustainability, MDPI, vol. 13(7), pages 1-23, March.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:7:p:3649-:d:523935
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