Investigating the validity of the agricultural-induced environmental Kuznets curve (EKC) hypothesis for Ghana: evidence from an autoregressive distributed lag (ARDL) approach with a structural break
Management of Environmental Quality
ISSN: 1477-7835
Article publication date: 7 December 2021
Issue publication date: 21 February 2022
Abstract
Purpose
The purpose of this research is to examine the validity of the agriculture-induced environmental Kuznets curve (EKC) hypothesis with evidence from an autoregressive distributed lag (ARDL) approach with a structural break including real income and energy consumption in the model for Ghana over the period 1980–2014.
Design/methodology/approach
The ARDL approach with a structural break was used to analyze the agriculture-induced EKC model which has not been studied in Ghana. The dynamic ordinary least squares (DOLS), canonical cointegration regression (CCR) and fully modified ordinary least squares (FMOLS) econometric methods were further used to validate the robustness of the estimates, and the direction of the relationship between the study variables was also clarified using the Toda–Yamamoto Granger causality test.
Findings
The ARDL results revealed that GDP, energy consumption and agricultural value added have significant positive effects on CO2 emissions, while GDP2 reduces CO2 emissions. The Toda-Yamamoto causality test results show a bidirectional causality running from GDP and energy consumption to CO2 emissions whereas a unidirectional long-term causality runs from GDP2 and agriculture value-added to CO2 emissions.
Practical implications
This finding validated the presence of the agriculture-induced EKC hypothesis in Ghana in both the short run and long run, and the important role of agriculture and energy consumption in economic growth was confirmed by the respective bidirectional and unidirectional causal relationships between the two variables and GDP. Thus, a reduction in unsustainable agricultural practices is recommended through specific policies to strengthen institutional quality in Ghana for a paradigm shift from rudimentary technology to modern sustainable agrarian technologies.
Originality/value
This study is novel in the EKC literature in Ghana, as no study has yet been done on agriculture-induced EKC in Ghana, and the other EKC studies also failed to account for structural breaks which have been done by this study. This study further includes a causality analysis to examine the direction of the relationship which the few EKC studies in Ghana failed to address. Finally, dynamic ordinary least squares (DOLS), canonical cointegration regression (CCR) and fully modified ordinary least squares (FMOLS) methods are used for robustness check, unlike other studies with single methodologies.
Keywords
Acknowledgements
Data availability: The datasets used and analyzed during the current study are available from the corresponding author on reasonable request.
Authors' contributions: Conceptualization, Y.Q., R.R. and G.N.; methodology, Y.Q. and G.N.; software, Y.Q. and G.N; validation, Y.Q., R.R., and G.N; formal analysis, M.A.T. and G.N; investigation, S.A.; resources, Y.Q. and L.K.B.; data curation, Y.Q. and E.K.A.; writing – original draft preparation, Y.Q., G.N., and R.R.; writing – review and editing, E.K.A., L.K.B., and S.A; visualization, Y.Q. E.K.A., and L.K.B; supervision, Y.Q. and R.R.; project administration, R.R.; all authors have read and agreed to the final version of the manuscript.
Funding: This research was funded by the Humanities and Social Sciences Project of the Ministry of Education of China (17YJA630124).
Competing interests: The authors declare that they have no competing interests.
The authors acknowledge the support of all respondents who availed to answer the questionnaires also they extend great gratitude to the editors and anonymous reviewers for their helpful review and critical comments.
Citation
Ntim-Amo, G., Qi, Y., Ankrah-Kwarko, E., Ankrah Twumasi, M., Ansah, S., Boateng Kissiwa, L. and Ruiping, R. (2022), "Investigating the validity of the agricultural-induced environmental Kuznets curve (EKC) hypothesis for Ghana: evidence from an autoregressive distributed lag (ARDL) approach with a structural break", Management of Environmental Quality, Vol. 33 No. 2, pp. 494-526. https://doi.org/10.1108/MEQ-05-2021-0109
Publisher
:Emerald Publishing Limited
Copyright © 2021, Emerald Publishing Limited