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Examining the Interaction Effect of Control of Corruption and Income Level on Environmental Quality in Africa

Ojonugwa Usman (), Paul Iorember (), Ilhan Ozturk () and Festus Bekun ()

Sustainability, 2022, vol. 14, issue 18, 1-15

Abstract: The effects of corruption and income on environmental degradation is well established in the literature. However, little attention has been given to how the control of corruption affects the environmental quality at different levels of income. This study examines the interaction effect of the control of corruption and income on environmental quality in Africa over the period from 1996 to 2017. Using a Method of Moments Quantile Regression (MMQR) with fixed effects, the results revealed that both the control of corruption and income level increase CO 2 emissions while their interaction term reduces CO 2 emissions. This implies that the interaction effect of the control of corruption and income level mitigates carbon emissions. Particularly, the marginal effect of the control of corruption on CO 2 emissions decreases as income level increases. Furthermore, renewable energy consumption has a negative and significant effect on CO 2 emissions. The effect of foreign direct investment on CO 2 emissions is positive and significant, which validates the pollution haven hypothesis. These results are heterogeneous across the quantile distribution of CO 2 emissions. Based on these findings, our study suggests the need for the government and policymakers to stimulate income levels as a prerequisite for achieving sound and effective environmental policies in Africa.

Keywords: environmental quality; corruption; income level; renewable energy; Africa (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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