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

See all articles by Simplice Asongu

Simplice Asongu

African Governance and Development Institute

Nicholas Odhiambo

University of South Africa - Department of Economics

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

Suggested Citation

Asongu, Simplice and Odhiambo, Nicholas, The Role of Globalization in Modulating the Effect of Environmental Degradation on Inclusive Human Development (January 18, 2020). Forthcoming in Innovation: The European Journal of Social Science Research. DOI: 10.1080/13511610.2020.1745058. Available at SSRN: https://ssrn.com/abstract=3556420

Simplice Asongu (Contact Author)

African Governance and Development Institute ( email )

P.O. Box 8413
Yaoundé, 8413
Cameroon

Nicholas Odhiambo

University of South Africa - Department of Economics ( email )

PO Box 392
Pretoria, 0003
South Africa

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