Natural resources, technological innovation, and eco-efficiency: striking a balance between sustainability and growth in Egypt

Chinazaekpere Nwani, Assad Ullah (), Titus Ayobami Ojeyinka (), Paul Terhemba Iorember () and Festus Victor Bekun ()
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Assad Ullah: Hainan Normal University
Titus Ayobami Ojeyinka: Obafemi Awolowo University
Paul Terhemba Iorember: Nile University of Nigeria
Festus Victor Bekun: Istanbul Gelisim University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2025, vol. 27, issue 1, No 50, 1467-1498

Abstract: Abstract Striking a balance between economic growth and environmental protection remains a crucial component of the sustainable development agenda. This study defines economic efficiency using an ecological efficiency approach, which measures the overall economic output generated per global hectare of ecological productive resources utilized. Examining the Egyptian economy from 1980 to 2018, the study investigates two prominent trends: the decreasing reliance on natural resource rents and the increasing growth of technological innovation. By employing the autoregressive distributed lag (ARDL) bounds test, the presence of cointegration is confirmed in all models, indicating that the variables converge in the long run. Additionally, the Spectral Granger-causality test is used to determine the causality direction across the permanent, intermediate, and temporary frequency domains. The results indicate that oil, coal, and natural gas impede eco-efficiency in Egypt, and the causality is unidirectional in the medium and long term, running from economic dependence on their extraction to eco-efficiency. As for the impact of technological innovation, the long-term analysis demonstrates that both domestically created and foreign (transferred) innovations significantly enhance eco-efficiency. The causality is unidirectional as well, with innovation leading to improvements in the eco-efficiency indicator. The study concludes that technological innovation offers essential economic and environmental benefits necessary for building an eco-efficient economy in Egypt. As a result, the study puts forth several policy recommendations aimed at facilitating well-informed decision-making.

Keywords: Eco-efficiency; Ecological footprint; Natural resources; Technological innovation; Spectral granger-causality (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10668-023-03920-8

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