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Institutional quality and CO2 emission–trade relations: evidence from Sub‐Saharan Africa


Citation

Ibrahim, Mansor and Law, Siong Hook (2016) Institutional quality and CO2 emission–trade relations: evidence from Sub‐Saharan Africa. South African Journal of Economics, 84 (2). pp. 323-340. ISSN 0038-2280; ESSN: 1813-6982

Abstract

This paper examines the roles of trade, institutional quality and their interactions in explaining carbon dioxide emissions in a panel sample of 40 Sub‐Sahara African countries using the system generalised method of moments. We find that institutional reforms are unequivocally environmental improving. Meanwhile, the impacts of trade on the environment tend to depend on the institutional setting of a country. More specifically, trade openness is harmful to the environment in countries with low institutional quality and beneficial to the environment in countries with high institutional quality. This means that institutional reforms are a perquisite for the countries with low institutional quality to actualise the beneficial environment effect of trade. As for the countries with adequate institutional quality, trade and institutions are reinforcing each other in bringing down pollution. From these results, we conclude that trade openness implemented in a sound institutional setting potentially brings better trade, more growth and better environment.


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Additional Metadata

Item Type: Article
Subject: Trade; Pollution relations; Institutions; Sub-Sahara Africa
Divisions: Faculty of Economics and Management
DOI Number: https://doi.org/10.1111/saje.12095
Publisher: Blackwell Publishing
Depositing User: Nurul Ainie Mokhtar
Date Deposited: 02 Apr 2018 01:09
Last Modified: 02 Apr 2018 01:09
Altmetrics: http://www.altmetric.com/details.php?domain=psasir.upm.edu.my&doi=10.1111/saje.12095
URI: http://psasir.upm.edu.my/id/eprint/54580
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