Reinvestigating the determinants of environmental degradation in Nigeria

Abstract

This study aims to reinvestigate the impact of economic growth in relation with trade openness, financial development, energy consumption and foreign direct investment to overcome the omitted variable problem on environmental degradation in Nigeria for the years from 1971 to 2015. Bounds test results reveal a cointegrating relationship between variables in the long run. Both in the long and short run, economic growth tends to affect CO 2 emissions positively. In the long run, energy consumption positively impacts CO 2 emissions while CO 2 emissions tend to be negatively affected by foreign direct investment. Furthermore, a robust check was performed through the FMOLS and DOLS to establish the long run effect. Moreover, we employed wavelet coherence based causality test which provided stronger supportive evidence to the long-run estimations of this study. The significance of this study stems from the uniqueness that to the best of our knowledge there has been no study combining these variables in addition to the fact that the econometric techniques employed have not been applied in conjunction to the subject for the case of Nigeria.

Determinants of CO2 Emissions in Emerging Markets: An Empirical Evidence from MINT Economies

“…The coefficient of energy usage is 2.16, suggesting a 1% increase in energy consumption will lead to 2.16% in CO2 emissions when other variables are held constant. This finding concurs with past studies (Farhani et al 2014;Ayobamiji & Kalmaz, 2020). There is an increase in CO2 emissions due to an increase in production and consumption of energy.…”

“…Pao & Tsai (2010) reveal that the link between energy consumption and GDP growth is bi-directional, which is contrary to the study done by Gorus & Aydin (2018). Akin (2014), Ertugrul et al (2016); Ayobamiji and Kalmaz, (2020) and Farhani et al (2014) explores the nexus between economic growth, energy consumption, Trade and CO2 emissions. Akin (2014) revealed that there is an uni-directional relationship running from CO2 emission and trade while Ertugrul et al (2016) study shows that there is an uni-directional relationship running from trade and CO2 emission.…”

“…However, in a recent study done by which was concentrated on Middle East countries, a unidirectional relationship was established moving from CO2 emission to GDP growth. Zaidi et al (2017) showed that GDP growth tends to reduce CO2 emissions while in a recent study done by Ayobamiji & Kalmaz (2020) revealed that energy and GDP growth increase CO2 emissions.…”

“…Recently, environmental degradation, climate change and ecological distortions have been the major problems caused by the increase in the exploitation of natural resources and the production of goods and services (Ayobamiji & Kalmaz, 2020). The primary goal of developed countries is to expand their economy further, therefore there is a significant concern on the part of the environmentalists and policymakers to minimize the sideeffect of this expansion.…”

Can Co2 Emissions and Energy Consumption Determine the Economic Performance of South Korea? A Time-Series Analysis

“…The study of Teng et al (2020) found that GDP increases CO2 emission for ten different OECD economies over the coverage between 1985 and 2018. However, Ayobamiji & Kalmaz (2020) employed the wavelet technique in capturing the time-frequency dependency between CO2 and real output, which is consistent with the results of Teng et al (2020). Aye & Edoja (2017) shows there is a negative link between GDP and CO2 emission in 31 developing countries.…”