Towards sustainability: The relationship between foreign direct investment, economic freedom and inclusive green growth

Ofori, Isaac Kwesi; Figari, Francesco; Ojöng, Nathanael

doi:10.1016/j.jclepro.2023.137020

Cited by 22 publications

(2 citation statements)

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“…First, the Blundell and Bond IV estimator addresses endogeneity. In this study, endogeneity is apparent, for example, in Equation ( 10) because of the possible reverse causality between financial development and IGG on the one hand (Ofori et al, 2023a), and foreign direct investment and IGG on the other hand (Ofori et al, 2023b). Second, the number of sampled countries (N=22) is higher than the study period (T=13).…”

Section: Model Specifications and Empirical Strategymentioning

confidence: 89%

Does Economic Complexity Promote Inclusive Green Growth?

Gbolonyo,

Ofori,

Ojong

2024

Preprint

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Despite the growing scholarly attention concerning the effect of economic complexity (ECI) on inclusive growth and the environment, there remain some pertinent gaps in the literature. First, previous studies have not explored the effect of ECI on inclusive green growth (IGG). Second, prior contributions have not assessed the role of energy consumption (disaggregated into renewable and non-renewable) in the relationship between ECI and IGG. This study addresses these gaps by using macro data for 22 selected African countries. Robust evidence based on the dynamic system GMM and the Driscoll-Kraay standard errors estimators reveal that economic complexity promotes IGG. Additionally, the contingency analysis reveals that non-renewable energy diminishes the IGG-enhancing effect of ECI, whereas renewable energy amplifies it. Finally, when we decompose IGG into environmental and socioeconomic sustainability, we find that the ECI-energy consumption interaction has a greater effect on the latter rather than the former. We conclude that investments for boosting Africa's productive knowledge and renewable energy capacities are crucial for IGG. JEL Code: O44; O55; Q01; Q43; Q56

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