Economic growth, energy consumption, and quality environment in Nigeria
Keywords:energy consumption, economic growth, enviroment, Nigeria
The paper examines the impact of energy consumption on economic growth and environmental quality and also verifies the existence of the Environmental Kuznets Curve (EKC) hypothesis in Nigeria. The Autoregressive Distributed Lag (ARDL) approach was used to estimate data covering 1981-2015 period. The result of the first model reveals evidence of inverse and significant impact of energy consumption on economic growth. Capital and trade openness show evidence of positive and significant impact on economic growth but labour reveals a negative and significant impact on economic growth. The result of the second model suggests that energy consumption is significant and positively related to environmental quality. As such, greater consumption of primary energy such as petroleum and natural gas increase carbon emissions which subsequently reduce environmental quality. Trade openness was also found to improve environmental quality. Furthermore, the test for EKC hypothesis did not reveal any evidence of its existence in Nigeria. This could result from the fact that growth level has not been expanded to a certain threshold beyond which additional expansion can reduce carbon emissions and improves environmental sustainability. The study recommends that efficiency in the use of conventional energy will go long way in reducing energy-related carbon emissions and enhance environmental sustainability. While improving human capital development will enhance the impact of labour force on economic growth in Nigeria.
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