The Role of Globalization in Modulating the Effect of Environmental Degradation on Inclusive Human Development
Forthcoming in Innovation: The European Journal of Social Science Research. DOI: 10.1080/13511610.2020.1745058
EXCAS Working Paper No. WP/20/015
30 Pages Posted: 13 Apr 2020
Date Written: January 18, 2020
Abstract
This study assesses how globalisation modulates the effect of environmental degradation on inclusive human development in 44 countries in Sub-Saharan Africa (SSA), using data for the period 2000 to 2012. The empirical results are based on the Generalized Method of Moments (GMM). The following main findings are established. First, a trade openness (imports + exports) threshold of between 80-120% of GDP is the maximum level required for trade openness to effectively modulate CO2 emissions (metric tonnes per capita) and induce a positive effect on inclusive human development. Second, a minimum threshold required for trade openness to modulate CO2 intensity (kg per kg of oil-equivalent energy use) and induce a positive effect on inclusive human development is 200% of GDP. Third, there is a net positive effect on inclusive human development from the relevance of trade openness in modulating the effect of CO2 emissions per capita on inclusive human development and a negative net effect on inclusive human development from the importance of trade openness in moderating the effect of CO2 intensity on inclusive human development.
Keywords: CO2 emissions; Economic development; Africa
JEL Classification: C52; O38; O40; O55; P37
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