Economic growth and deforestation in African countries: Is the environmental Kuznets curve hypothesis applicable?

Abstract

Deforestation is a significant environmental problem, contributing to biodiversity loss, land degradation, soil erosion, and climate change. During the past half-century, the continent of Africa has suffered massive losses of forested areas due to the changing structure of economies, increasing population, and expanding globalization. This research examines statistical evidence for the Environmental Kuznets Curve (EKC) hypothesis as applied to deforestation occurring within Africa from 1990 to 2016. Changes in forest cover data are explained with Generalized Method of Moments (GMM) estimators to overcome the endogeneity problems arising from reverse causality. The empirical results of Panel GMM confirm the EKC hypothesis is valid for deforestation in Africa with a turning point estimated to be US $3000. Heterogenous panel non-causality findings suggest that Africa could deter and reverse deforestation through appropriate land-use and forest products trade policies, and the consequences of these policies would not impact their economic growth.