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Investigating the determinants of load capacity factor in Nigeria: An asymmetric quantile approach on urbanization, economic growth, FDI, and resource dependency

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  • Akadiri, Seyi Saint
  • Ozkan, Oktay
  • Alola, Andrew Adewale

Abstract

Nigeria's pursuit of economic growth has raised concerns about its environmental sustainability, particularly regarding the effects of resource dependency, urbanization, and foreign direct investment (FDI). This study employs wavelet quantile regression (WQR) to examine how these factors influence Nigeria's load capacity factor from 1970 to 2022. Findings reveal that economic growth consistently degrades environmental quality across all quantiles, with worsening effects over time. FDI and urbanization similarly exert negative ecological impacts, particularly at medium and high quantiles. Resource dependency harms environmental quality at lower and higher quantiles but shows no effect at mid-levels. Wavelet quantile Granger causality (WQGC) confirms strong short- and medium-term causal relationships. These insights highlight the environmental costs of economic expansion and guide policymakers striving to balance development with sustainability.

Suggested Citation

  • Akadiri, Seyi Saint & Ozkan, Oktay & Alola, Andrew Adewale, 2025. "Investigating the determinants of load capacity factor in Nigeria: An asymmetric quantile approach on urbanization, economic growth, FDI, and resource dependency," Resources Policy, Elsevier, vol. 104(C).
    • Handle: RePEc:eee:jrpoli:v:104:y:2025:i:c:s030142072500128x
    DOI: 10.1016/j.resourpol.2025.105586
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    More about this item

    Keywords

    Resource dependency; Urbanization; Economic growth; Foreign direct investment; Environmental quality; Load capacity factor; Wavelet quantile regression; Nigeria;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • 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
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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