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The Impact of Renewable Energy Consumption and Economic Growth on Environmental Degradation in Somalia

Author

Listed:
  • Iqra Hassan Mohamud

    (Faculty of Management Sciences, SIMAD University, Mogadishu, Somalia,)

  • Ahmed Abdirashid Mohamud

    (Faculty of Accountancy, Simad University, Mogadishu, Somalia.)

Abstract

This study investigates the impact of renewable energy consumption and economic growth on environmental degradation in Somalia between the period 1990-2020. Econometric tools ARDL and Pairwise Granger Causality Test were used. A stationarity test was first carried out to ascertain the stationarity and all variables are all integrated of order (0) and (I). Results from the short term demonstrate a positive, significant relationship between renewable energy usage, oil price, and environmental deterioration, and a negative, significant relationship between foreign direct investment (FDI), population, and environmental degradation. More so, in the short term, there is a positive and insignificant relationship between economic growth and environmental degradation. while the long-run result revealed a positive, significant relationship between FDI, population, oil price, and environmental degradation, as well as a negative, significant relationship between the use of renewable energy, economic growth, and environmental degradation. Results indicate that renewable energy consumption is a key contributor to environmental degradation in both short and long-run periods in Somalia. The result from the Granger causality test revealed that there is unidirectional causality from EG to ED, REC to ED, ED to FDI, and FDI to EG of Somalia.

Suggested Citation

  • Iqra Hassan Mohamud & Ahmed Abdirashid Mohamud, 2023. "The Impact of Renewable Energy Consumption and Economic Growth on Environmental Degradation in Somalia," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 533-543, September.
    • Handle: RePEc:eco:journ2:2023-05-56
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    More about this item

    Keywords

    Renewable Energy; EG; Environmental Degradation; ARDL; Somalia;
    All these keywords.

    JEL classification:

    • P28 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Natural Resources; Environment
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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