Probing the environmental impacts of structural transition and demographic mobility in Africa: Does technological innovation matter?

Abstract

Although available statistics reveal Africa as an insignificant contributor to the devastating global climate condition, the succeeding impacts seem to hit the region harder than others. Efforts to address the environmental issues have seen the transition from carbon-intensive to carbon-abating sectors. Hence, this study makes the first empirical attempt to probe the ecological effects of structural transition and demographic mobility amidst the presence of technological innovation, foreign direct investment, and renewable energy. The empirical evidence focuses on the five highest emitters in Africa from 1990 to 2019 using advanced estimators, including cross-sectional autoregressive distributed lag (CS-ARDL), augmented mean group (AMG), common correlated effect mean group (CCEMG), and method of moment quantile regression (MMQR). For easy tracking of emanating effects, structural transition is captured by agriculture, manufacturing, and service sectors’ value added, whereas demographic mobility vectors rural and urban population. The results reveal agriculture sector, manufacturing sector, rural population, and urban population as amplifiers of CO2 emissions. Conversely, the moderating roles of technological innovation amidst service sector, foreign direct investment, and renewable energy are confirmed. Besides, Granger causality uncovers unidirectional and bidirectional causality in the model. Promoting developments in research and development and adopting carbon tax policies are among the emanating policies on the findings.