Climate Change in Sub-Saharan Africa Fragile States: Evidence from Panel Estimations

31 Pages Posted: 15 Apr 2022

See all articles by Rodolfo Maino

Rodolfo Maino

International Monetary Fund (IMF)

Drilona Emrullahu

International Monetary Fund (IMF)

Date Written: March 1, 2022

Abstract

Fragile states in sub-Saharan Africa (SSA) face challenges to respond to the effects of climate shocks and rising temperatures. Fragility is linked to structural weaknesses, government failure, and lack of institutional basic functions. Against this setup, climate change could add to risks. A panel fixed effects model (1980 to 2019) found that the effect of a 1◦C rise in temperature decreases income per capita growth in fragile states in SSA by 1.8 percentage points. Panel quantile regression models that account for unobserved individual heterogeneity and distributional heterogeneity, corroborate that the effects of higher temperature on income per capita growth are negative while the impact of income per capita growth on carbon emissions growth is heterogeneous, indicating that higher income per capita growth could help reduce carbon emissions growth for high-emitter countries. These findings tend to support the hypothesis behind the Environmental Kuznets Curve and the energy consumption growth literature, which postulates that as income increases, emissions increase pari passu until a threshold level of income where emissions start to decline.

Keywords: climate change, fragile states, climate risk, panel regressions Robustness test, panel quantile regression, panel regression estimate, energy consumption growth literature, quantile panel regression, Climate change, Greenhouse gas emissions, Income, Natural disasters, Carbon tax, Sub-Saharan Africa, Global, Africa

JEL Classification: Q50, Q54, Q58, E25, H23

Suggested Citation

Maino, Rodolfo and Emrullahu, Drilona, Climate Change in Sub-Saharan Africa Fragile States: Evidence from Panel Estimations (March 1, 2022). IMF Working Paper No. 2022/054, Available at SSRN: https://ssrn.com/abstract=4082980

Rodolfo Maino (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Drilona Emrullahu

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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