Environmental Performance and Economic Growth in the West African Economies

Hammed Oluwaseyi Musibau, Maria Belen Yanotti, Joaquin Vespignani and Rabindra Nepal

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: The importance of sustainable economic growth has been emphasized by the United Nations Sustainable Development Goals (SDG). SDGs 8 and 11 suggest that a sustainable environment can improve economic growth, which has been the priority for some governments worldwide. This study incorporates the environmental performance index (EPI) into the neoclassical growth model to examine the impact of environmental performance on economic growth for the Economic Community of West African States (ECOWAS). Using the two-step generalized method of moments (GMM) model, the empirical investigation finds a positive relationship between environmental performance and economic growth. More specifically, we find that improved environmental performance is observed to accelerate economic growth in non-oil-producing ECOWAS countries, but diminishes growth in oil-producing ECOWAS countries. Based on the findings, we recommend policies that encourage improved environmental performance in non-oil-producing ECOWAS economies.

Keywords: economic growth; environmental performance; ECOWAS; environmental governance; GMM; oil-producing economies (search for similar items in EconPapers)
JEL-codes: F64 K32 O47 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2024-12
New Economics Papers: this item is included in nep-env
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Working Paper: Environmental performance and economic growth in the West African economies (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2024-75

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