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Are growth effects of foreign capital significant for increasing access to electricity in Africa?

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  • Mbiankeu Nguea, Stéphane
  • KAGUENDO, Ulrich Vianney Elisée

Abstract

Despite the advancements towards Sustainable Development Goal 7, access to electricity in Africa is still lagging far behind the goal. In this study, we employ a panel data covering 36 African countries from 2000 to 2017 to investigate the effects of FDI, remittances and foreign aid on access to electricity. We use a dynamic empirical model based on system GMM to control for unobserved heterogeneity and potential endogeneity of the explanatory variables. The results show that FDI and remittances matter for increasing access to electricity. Also, foreign aid reduces access to electricity. We also find that remittances reduce urban-rural disparities in access to electricity, while FDI and foreign aid increase disparities. Finally, these results remain globally robust when we perform sub-regional analyses.

Suggested Citation

  • Mbiankeu Nguea, Stéphane & KAGUENDO, Ulrich Vianney Elisée, 2022. "Are growth effects of foreign capital significant for increasing access to electricity in Africa?," MPRA Paper 111604, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:111604
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    Cited by:

    1. Djeunankan, Ronald & Njangang, Henri & Tadadjeu, Sosson & Kamguia, Brice, 2023. "Remittances and energy poverty: Fresh evidence from developing countries," Utilities Policy, Elsevier, vol. 81(C).
    2. Ekene ThankGod Emeka & Simplice A. Asongu & Yolande E. Ngoungou, 2024. "Gender economic inclusion, governance institutions and economic complexity in Africa," Working Papers of The Association for Promoting Women in Research and Development in Africa (ASPROWORDA). 24/003, The Association for Promoting Women in Research and Development in Africa (ASPROWORDA).
    3. Moteng, Ghislain & Raghutla, Chandrashekar & Njangang, Henri & Nembot, Luc Ndeffo, 2023. "International sanctions and energy poverty in target developing countries," Energy Policy, Elsevier, vol. 179(C).
    4. Ongo Nkoa, Bruno Emmanuel & Tadadjeu, Sosson & Njangang, Henri, 2023. "Rich in the dark: Natural resources and energy poverty in Sub-Saharan Africa," Resources Policy, Elsevier, vol. 80(C).
    5. Noumba, Issidor & Nguea, Stéphane Mbiankeu, 2023. "Assessing the role of globalization for universal electricity access," International Economics, Elsevier, vol. 174(C), pages 180-195.
    6. Aluko, Olufemi Adewale & Opoku, Eric Evans Osei & Ibrahim, Muazu & Kufuor, Nana Kwabena, 2023. "Put on the light! Foreign direct investment, governance and access to electricity," Energy Economics, Elsevier, vol. 119(C).
    7. Stéphane Mbiankeu Nguea & Hervé Kaffo Fotio & Louise Angèle Baida, 2022. "Investigating the effects of globalization on economic sophistication in selected African countries," African Development Review, African Development Bank, vol. 34(3), pages 324-338, September.

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    More about this item

    Keywords

    FDI; Remittances; Foreign aid; Access to electricity; System GMM; Africa;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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