Electricity access, demographic transition and sustainable growth in frontier economies

Abstract

AbstractThe study investigates the mediating role of population growth in the nexus between electricity access and sustainable growth of frontier economies. The study spans the period 2000–2020 for a panel of 25 frontier economies. Predicated on a modified environmental Kuznets curve (EKC) model, the technique of analysis is the panel quantile regression across the three major threshold levels of 25th, 50th and 75th percentiles. Also, higher threshold levels such as 90th, 95th and 97.5th percentiles were investigated. Prior to the estimations, various preliminary tests, including the panel unit root tests, were conducted to confirm the data stability conditions of the variables. The study found that access to electricity engenders sustainable growth in these frontier economies only up to the 95th percentile. However, exchange rate is said to endanger the sustainable growth path of these economies and these economies should not tolerate any idea of currency devaluation. More so, these economies should be made competitive to avoid currency depreciation. Interestingly, the role of population growth can be described as being a dividend rather than a burden but became imperceptible at the 95th percentile. Hence, efforts should be made to make increasing population remain qualitative for growth to remain sustainable.