The impact of de facto globalization on carbon emissions: Evidence from Ghana

Abstract

In developing countries, the environmental externalities associated with globalization have become quite contentious among researchers and policymakers. To inform environmental policymakers and contribute to the debate on the globalization-environment nexus, this paper examines the effect of de facto economic, political and social globalization on Ghana’s CO2 emissions within the Stochastic Impacts by Regression on Population, Affluence, and Technology (STIRPAT) model. The nonlinear autoregressive distributed lag model was used to estimate the effect of de facto economic, political and social globalization on Ghana’s carbon emissions. The results suggest that a positive and negative change in political globalization increases CO2 emissions in the long run, while a positive and negative change in social globalization reduces CO2 emissions. The asymmetric results further revealed that both positive and negative changes to economic globalization have a neutral effect on CO2 emissions. The long-run results from the symmetric autoregressive distributed lag model also showed that political, social, and economic globalization increased Ghana’s CO2 emissions by 0.600%, 0.239% and 0.293%, respectively. These findings suggest that globalization has been triggering an environmental “race to the bottom” in Ghana.