Institutions and Geography: A “Two Sides of the Same Coin” Story of Primary Energy Use in Sub-Saharan Africa

Abstract

Do institutional and geographical characteristics matter for energy consumption similar to the case of economic development? Why do coastal Sub-Saharan African (SSA) countries appear to be more energy-consuming than inland ones? To answer these questions, surprisingly rarely addressed in the existing literature, we empirically assess the determinants of primary energy use across SSA, exploiting spatial analysis methods. Our results highlight the existence of positive geographical spillovers in primary energy use. We also derive factors (income, exports, population dynamics and urbanization) explaining the reasons coastal countries are more energy-intensive. Furthermore, good political institutions and geographical location enhance primary energy use, connoting a “two sides of the same coin” role played by both factors. Our results impel SSA countries to develop alternative energy strategies and deploy energy resources management policies since adverse environmental consequences associated with increasing fossil energies use are to expect in the near future.