1 A G D I Working Paper WP/18/017 Environmental Degradation and Inclusive Human Development in sub‐Saharan Africa1Forthcoming: Sustainable Development Simplice A. AsonguDepartment of Economics, University of South Africa. P. O. Box 392, UNISA 0003, Pretoria South Africa. E-mails: [email protected], [email protected]Nicholas M. OdhiamboDepartment of Economics, University of South Africa. P. O. Box 392, UNISA 0003, Pretoria, South Africa. Emails: [email protected], [email protected]1This working paper also appears in the Development Bank of NigeriaWorking Paper Series.
2 2018 African Governance and Development Institute WP/18/017 Research Department Environmental Degradation and Inclusive Human Development in sub‐Saharan Africa Simplice A. Asongu & Nicholas M. OdhiamboJanuary 2018 Abstract In the light of challenges to sustainable development in the post-2015 development agenda, this study assesses how increasing carbon dioxide (CO2) emissions affect inclusive human development in 44 countries in sub-Saharan Africa for the period 2000-2012. The following findings are established from Fixed Effects and Tobit regressions. First, unconditional effects and conditional impacts are respectively positive and negative from CO2emissions per capita, CO2emissions from liquid fuel consumption and CO2intensity. This implies a Kuznets shaped curve because of consistent decreasing returns. Second, the corresponding net effects are consistently positive. The following findings are apparent from Generalised Method of Moments (GMM) regressions. First, unconditional effects and conditional impacts are respectively negative and positive from CO2emissions per capita, CO2emissions from liquid fuel consumption and CO2intensity. This implies a U-shaped curve because of consistent increasing returns. Second, the corresponding net effects are overwhelmingly negative. Based on the robust findings and choice of best estimator, the net effect of increasing CO2emissions on inclusive human development is negative. Policy implications are discussed. JEL Classification: C52; O38; O40; O55; P37 Keywords: CO2emissions; Sustainable development;Inclusiveness; Environmental policy; Africa 1. Introduction Three contemporary trends in academic and policy circles motivate the positioning of this inquiry, namely: growing exclusive development in sub-Saharan Africa (SSA); poor energy and environmental management in the sub-region and gaps in the literature. We discuss the points in chronological order.
3 First, in the transition from the Millennium Development Goals (MDGs) to Sustainable Development Goals (SDGs), extreme poverty has been decreasing in all regions of the world with the exception of SSA (World Bank, 2015; Asongu & le Roux, 2017). According to the narrative, the fact that close of half of nations in the sub-region were considerably off-course from achieving the MDG extreme poverty target is an indication that the fruits of economic prosperity accruing from the recent growth resurgence have not been trickling down to the poorest factions of the population. Obviously, this substantial and consistent trend of economic