Coal mining and environmental sustainability in South Africa: do institutions matter?

Abstract

This study investigates the effects of coal mining on environmental sustainability in South Africa in relation to the moderating role of institutions. To achieve the study's objectives, the fully modified least square (FMOLS), dynamic least squares (DOLS), canonical cointegrating regression (CCR), Bayer-Hanck cointegration and Toda-Yamamoto causality test are employed for the period 1984-2018. Results from the study show that coal mining contributes to environmental degradation in South Africa, while its interaction with institutional quality mitigates the severity of this negative impact. Furthermore, there is evidence that economic growth has a bidirectional causality with ecological footprint and coal mining, while institutional quality also Granger causes ecological footprint. To promote a sustainable environment, there is a need for the government and the institutions to form the foundation for the shift toward environmental sustainability, with particular attention paid to the development and implementation of greenhouse policy.