On the Water-Energy-Food Nexus: Is there Multivariate Convergence?
40 Pages Posted: 18 Mar 2021 Last revised: 25 Mar 2021
Date Written: March 17, 2021
This paper provides new evidence on the convergence process of energy, water and food per capita consumption levels for 108 countries from 1971 to 2018, using a common data set, with VAR and panel data approach. We establish a new notion of multivariate sigma and beta-convergence. The results reveal that there is evidence of sigma- absolute beta- and conditional beta-convergence process for the countries. Moreover, the multivariate approach reveals that there are spillover effects with complex positive impact of each variable on the others in the analyzed countries. The speed of convergence is simulated to assess when the desired levels according to the prescription of the SDG of per water, energy and food capita consumption is reached by each country. Results have important policy implications for interventions on macro variables. Investment has a positive accelerating effect on water convergence. In addition, investment, openness to foreign trade and inflow of foreign direct investment have a positive accelerating effect on food convergence as well as on energy convergence.
Keywords: Water, Energy, Food Nexus, Multivariate Convergence, Sustainable Development Goals, Worldwide Countries Data Set
JEL Classification: C33, Q43, O11, O13, R11
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