The connection between urbanization and carbon emissions: a panel evidence from West Africa

This study examined the nexus between urbanization and carbon emissions in West Africa. Second-generation econometric techniques that are robust to cross-sectional dependence and slope heterogeneity were used for the study. From the Pesaran-Yamagata homogeneity test, the slope coefficients were heterogeneous in nature. Also, the Breusch-Pagan LM test, the Pesaran scaled LM test, bias-corrected LM test, Pesaran CD test and the Friedman's test confirmed the studied panels to be cross-sectionally dependent. Further, the CADF and the CIPS unit root tests established the variables to be first-differenced stationary. Additionally, the Westerlund and Edgerton bootstrap cointegration test and the Pedroni residual cointegration test affirmed the series to be cointegrated in the long run. The Driscoll-Kraay standard errors regression estimator was employed to examine the long-run equilibrium relationship amid the series, and from the results, urbanization had a significantly positive influence on CO2 emissions in all the three panels. Also, economic growth had a materially positive effect on CO2 emissions, while renewable energy consumption had a substantially negative impact on CO2 emissions in all the panels. The causal connections amid the series were finally explored through the Dumitrescu-Hurlin panel causality test, and the discoveries were a bit varied across the various panels. Policy recommendations are further discussed.