Hammed Oluwaseyi Musibau, Waliu Olawale Shittu and Fatai Olarewaju Ogunlana
The purpose of this paper is to study the relationship among environmental degradation, energy use and economic growth, thus lending a voice to testing the relevance, or…
Abstract
Purpose
The purpose of this paper is to study the relationship among environmental degradation, energy use and economic growth, thus lending a voice to testing the relevance, or otherwise, of the environmental Kuznets curve (EKC) hypothesis in Nigeria.
Design/methodology/approach
The authors rely on the secondary data obtained from World Bank’s World Development Indicators for Nigeria, between 1981 and 2014. The non-linear autoregressive distributed lag (ARDL) technique is used after examining the unit root properties – using the augmented Dickey–Fuller and Phillips–Perron methods – and the long-run relationship – using the ARDL bounds approach to estimate the asymmetries in the effects of economic growth on the environment.
Findings
The findings of this study uphold the relevance of the EKC hypothesis in Nigeria, as the growth of GDP first reduces the environmental quality but raises it over time. Furthermore, the use of energy is found to deteriorate environmental quality, given that CO2 rises by 0.002% for a unit increase in the consumption of energy in Nigeria.
Research limitations/implications
A limitation to this research is the data coverage, which is just between 1981 and 2014, based on availability. One other limitation is the use of electric power consumption as a proxy for energy use (because of the difficulty in obtaining accurate data on energy consumption in Nigeria). Future research should, therefore, test different other proxies, to either agree with the findings or justify any deviation therefrom. Also, the use of up-to-date data is recommended as an improvement to this study, while a non-linear technique should be used on studies involving the panel of countries.
Originality/value
Many studies have examined this relationship by simply taking the square of GDP as a measure of its non-linear effect on the environment. The authors are one of the first who consider the asymmetric effect of economic growth on the environment through the non-linear ARDL technique. With this, the partial sums of positive and negative changes in economic growth on the environment are easily established.
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Waliu Olawale Shittu, Nor Asmat Ismail, Abdul Rais Abdul Latiff and Hammed Oluwaseyi Musibau
Amongst the major concerns of sub-Sahara Africa are the rising external debt and poor performances in governance. This paper aims to lend a voice to the relevance of governance on…
Abstract
Purpose
Amongst the major concerns of sub-Sahara Africa are the rising external debt and poor performances in governance. This paper aims to lend a voice to the relevance of governance on the relationship between external debt and economic growth in selected five sub-Saharan African (SSA) countries.
Design/methodology/approach
Using available data from the World Governance and Development Indicators, between 1996 and 2016, the study uses the fully-modified OLS technique after establishing the absence of unit root and existence of long-run relationship amongst the variables of the model.
Findings
The findings confirm a non-linear relationship between external debt and economic with a positive net effect of $5.05 increase in economic performance for a US$ rise in external debt. While the index of governance depicts a negative association with economic growth, the indicators show mixed results. The interaction effect of external debt and governance on economic performance explain that improved governance quality reduces its negative effect on economic performance by US$1.288 (with a total effect of –4.180 + 1.288*EXDBT); it equally enhances the (net) positive impact of external debt by US$1.288 (with a total effect 5.05 + 1.288*IQ).
Practical implications
The governments of the selected countries are, therefore, advised to seek other means of financing their expenditure while curbing financial mismanagement and its long-term impacts on growth. Also, governance infrastructures should be improved to restore both domestic and foreign investors’ confidence so that more private capitals may be attracted in lieu of excessive borrowings.
Originality/value
The research is the first to comprehensively examine the nexus between external debt, governance and economic growth in the selected countries, given their external debt position in SSA. This includes examining the impacts of each of the governance indicators and the comprehensive index of governance on growth. Furthermore, the study adds to the literature by examining the interaction effects of external debt and governance on economic growth of these countries. This gives both the partial and total estimates of the effects of external debt and governance on economic growth in the countries under consideration.
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Waliu Olawale Shittu, Hammed Agboola Yusuf, Abdallah El Moctar El Houssein and Sallahuddin Hassan
This paper measures the impacts of foreign direct investment (FDI), globalisation and political governance on economic growth in West Africa. The empirical analysis also includes…
Abstract
Purpose
This paper measures the impacts of foreign direct investment (FDI), globalisation and political governance on economic growth in West Africa. The empirical analysis also includes the interaction effect of political governance and FDI on the growth of the sub-region, over the period of 1996–2016.
Design/methodology/approach
The study employs the autoregressive distributed lag technique on data obtained from the World Bank and the KOF institute.
Findings
The study findings suggest a positive relationship between globalisation and political governance on economic growth. Even though there have been inconclusive results on the FDI–growth nexus, the authors found that FDI stimulates the growth of the sub-region, while political governance enhances the positive impact of FDI on economic growth. The other factors of growth included are labour, capital and government size, whose effects on growth are, respectively, negative, negative and positive.
Practical implications
The governments of the West African countries promote policies that attract FDI into the sub-region, so that economic performances may be enhanced. In addition, the governments of the West African sub-region should work to reap the benefits of globalisation, by promoting the competitiveness of their local economies in order to keep pace with the global markets. Finally, the political-governance infrastructures should be overhauled; the culture of accountability and transparency should be promoted, while all efforts should be made to improve stability in the political environment in order to increase investors' confidence in the West African economy.
Originality/value
This study is the first to single out the impacts of political governance, as categorised by the World Bank, through both direct and interactive measures. This is necessary in view of the assertion that political governance largely accounts for improved economic performance in an economy. The use of the Pesaran (2007) technique of unit root is also a deviation from existing studies. This is in view of the fact that it tests variable unit root in the presence of cross-sectional dependence; thus, controlling for contemporaneous correlation which was not considered in the first-generation tests.
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Waliu Olawale Shittu, Sallahuddin Hassan and Muhammad Atif Nawaz
The purpose of this paper is to examine the impact of external debt and corruption on economic growth in the selected five Sub-Saharan African (SSA) countries, from 1990 to 2015.
Abstract
Purpose
The purpose of this paper is to examine the impact of external debt and corruption on economic growth in the selected five Sub-Saharan African (SSA) countries, from 1990 to 2015.
Design/methodology/approach
Panel unit root and panel cointegration tests are employed to test for stationarity of the series and the long-run relationship, respectively. Fully modified OLS and dynamic OLS techniques are also employed to examine the long-run coefficients of the variables of the model, as well as panel Granger causality test, in order to examine the direction of causality among the variables.
Findings
The results indicate that there is a negative relationship between external debt and economic growth, as well as a bi-directional causality between the two variables. The findings also indicate a positive relationship between corruption and economic growth, as well as a uni-directional causality running from economic growth through corruption.
Research limitations/implications
The study recommends that the governments of the selected countries should address the menace of rising external debt through the adoption of other sources of capital for investment. Such include more openness of the economy for more capital, by easing restrictions on genuine imports and exports of valuable goods and services. It also suggests that the issue of corruption be tackled head-on, by such penalties that tend to make corruption less attractive.
Originality/value
While the relationship between economic growth and external debt, on the one hand, and corruption and economic growth, on the other hand, have received considerable attentions, the trio of external debt, corruption and economic growth have not been found combined in a model, to the best of the authors’ knowledge. Also, the countries under consideration, who jointly account for about 47 percent of the entire SSA countries’ stock of external debt, have not been jointly found in any recent panel studies involving the selected variables.
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Waliu Olawale Shittu and Norehan Abdullah
The purpose of this paper is to examine the relationship among fertility, female education and female labour participation in ASEAN-7 countries: Malaysia, Indonesia, Brunei…
Abstract
Purpose
The purpose of this paper is to examine the relationship among fertility, female education and female labour participation in ASEAN-7 countries: Malaysia, Indonesia, Brunei, Myanmar, the Philippines, Vietnam and Thailand, between 1990 and 2015. The choice of these countries is informed by their economic, social and political importance in the ASEAN Bloc; while Indonesia boasts of the largest population in ASEAN, Brunei and Malaysia boast of relatively advanced economies, in GDP terms.
Design/methodology/approach
Pesaran’s test of panel unit root in the presence of cross-sectional dependence was employed to test for the stationarity properties of the series. The dynamic long-run coefficients of the variables were examined using the pooled mean group, common correlated effect and dynamic OLS techniques, while the Granger causality test was used to estimate the direction of causality among the variables.
Findings
The findings indicate that there is both negative and positive relationship between fertility and labour force participation, with causality running from labour force participation through fertility – on the one hand, and between education and labour force participation, with no causality between the two – on the other hand.
Research limitations/implications
The study, therefore, upholds the role incompatibility and societal response hypothesis, as well as human capital and opportunity cost theories.
Practical implications
The appropriate policies are those that gear the countries’ fertility decisions towards the societal response hypothesis in order to enhance human capital development and increase productivity. This implies that the governments of ASEAN-7 countries should ease hindrances on a balanced combination of family-care and workforce participation on married women in view of the gender-wage gap created by female work apathy, which largely reduces domestic productivities. Appropriate policies in this direction include rising availability and affordability of childcare facilities, incentives for women higher education, attitudinal changes towards job-participating mothers, as well as legislated paid parental leaves which have balanced the, hitherto, incompatibility between work and childbearing.
Originality/value
Except for Abdullah et al. (2013), the authors have no knowledge of other authors who have worked on this relationship in the chosen ASEAN countries. This study is, however, an improvement upon that of Abdullah et al. (2013) in different ways, one of which is that it considers seven ASEAN countries, thus making the results more valid representation of the ASEAN Bloc. Furthermore, the Pesaran (2007) technique of unit root testing has not been found in any recent literature on the subject-matter. This technique, being a second-generation test, tests variable unit root in the presence of cross-sectional dependence.
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Hammed Agboola Yusuf, Waliu Olawale Shittu, Saad Babatunde Akanbi, Habiba MohammedBello Umar and Idris Abdulganiyu Abdulrahman
In this research, we examine the role of financial development, FDI, democracy and political instability on economic growth in West Africa.
Abstract
Purpose
In this research, we examine the role of financial development, FDI, democracy and political instability on economic growth in West Africa.
Design/methodology/approach
The study uses the dynamic fixed effects technique on the secondary data obtained from 1996 to 2016.
Findings
Our empirical findings suggest that even though no significant relationship is established in the short run, the long-run coefficient of FDI is found to be significant and positive; a 1% increase in FDI inflow into the West African sub-region results in a 0.26% increase in economic growth. The coefficient of democracy is significant neither in the short run nor in the long run, but political instability is found to significantly and negatively impact the growth of the countries. Finally, the estimate of financial development–growth nexus follows the supply-leading hypothesis.
Research limitations/implications
This research affirms the proposition that FDI is a relevant means of technology and knowledge transfers, thus resulting in increasing returns to production as a result of productive spillovers, which drives the growth of the economy. Consequently, an efficient institution – where the rule of law, political stability and economic freedom are top priorities – is a key to accelerate the growth of the West African economy. Similarly, we confirm the validity of the supply-leading hypothesis in West Africa. As such, by deepening the financial system, the growth of the subregion is propelled because an efficient financial system is a basis for sustainable development.
Practical implication
The applicable policies are those that promote growth through FDI, financial development, democracy and political instability. The governments of West African countries are enjoined to promote policies that attract FDI into the subregion and promote financial sector credits so that economic performances may be enhanced. In addition, the governments of West African subregion should fully entrench democratic practices and enhance a stable and sustainable political environment. This will not only restore investor confidence but will also facilitate the inflow of FDI into the West African economy.
Originality/value
Our study is the first to jointly examine these important growth determinants, especially in the context of West Africa. This becomes necessary in order to open the eyes of policy makers to the need for entrenched full democracy and to proffer sustainable cures to the frequent unrests in the subregion. The use of Pesaran (2007) technique of unit root is also a deviation from several existing studies. One advantage of this technique over others is that being a second-generation test, it tests variable unit root in the presence of cross-sectional dependence.