IDEAS home Printed from https://ideas.repec.org/a/sae/engenv/v35y2024i6p2911-2934.html
   My bibliography  Save this article

Natural resource rent, financial globalization, and environmental degradation: Evidence from a resource rich country

Author

Listed:
  • Seyi Saint Akadiri
  • Godwin Olasehinde-Willams
  • Ilham Haouas
  • Gold Olamide Lawal
  • Ayodeji Samson Fatigun
  • Yetunde Sadiq-Bamgbopa

Abstract

This paper examines the role of financial globalization and natural resource rents on carbon emissions in the case of Nigeria from 1970 to 2020 using Breitung-Candelin Spectral Granger-causality and wavelet coherence analysis. The spectral analysis decomposes variability in a time series into its periodic components, which is preferable for series that are short-spanned, nonlinear, or are characterized by seasonal and economic episodes, while the wavelet coherence analysis could produce localized decompositions both in time and frequency domains. Using these techniques, we find a one-way causal effect running from financial globalization and natural resource rents to carbon emissions within the specified scale and time. Financial globalization and natural resource rents are useful for predicting environmental degradation in Nigeria. Thus, policymakers should factor in financial globalization and natural resource rent when formulating environmental policies to mitigate climate change effect for the immediate and future generations. Financial penetration should be channeled toward green investment. The deposit money banks should provide and prioritize credit only to firms and individuals that consider investing in modern and clean technologies, while the policy on exploration and exploitation of natural resources should review to attract foreign investors that would improve the existing technologies or bring in energy-efficient and energy-saving ones.

Suggested Citation

  • Seyi Saint Akadiri & Godwin Olasehinde-Willams & Ilham Haouas & Gold Olamide Lawal & Ayodeji Samson Fatigun & Yetunde Sadiq-Bamgbopa, 2024. "Natural resource rent, financial globalization, and environmental degradation: Evidence from a resource rich country," Energy & Environment, , vol. 35(6), pages 2911-2934, September.
    • Handle: RePEc:sae:engenv:v:35:y:2024:i:6:p:2911-2934
    DOI: 10.1177/0958305X231159446
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0958305X231159446
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0958305X231159446?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jalil, Abdul & Feridun, Mete, 2011. "The impact of growth, energy and financial development on the environment in China: A cointegration analysis," Energy Economics, Elsevier, vol. 33(2), pages 284-291, March.
    2. Muhammad Shahbaz & Mehmet Akif Destek & Michael L. Polemis, 2018. "Do Foreign Capital and Financial Development Affect Clean Energy Consumption and Carbon Emissions? Evidence from BRICS and Next-11 Countries," SPOUDAI Journal of Economics and Business, SPOUDAI Journal of Economics and Business, University of Piraeus, vol. 68(4), pages 20-50, October-D.
    3. Siming Zuo & Mingxia Zhu & Zhexiao Xu & Judit Oláh & Zoltan Lakner, 2021. "The Dynamic Impact of Natural Resource Rents, Financial Development, and Technological Innovations on Environmental Quality: Empirical Evidence from BRI Economies," IJERPH, MDPI, vol. 19(1), pages 1-17, December.
    4. Tomiwa Sunday Adebayo & Dervis Kirikkaleli, 2021. "Impact of renewable energy consumption, globalization, and technological innovation on environmental degradation in Japan: application of wavelet tools," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(11), pages 16057-16082, November.
    5. Seyi Saint Akadiri & Taiwo Temitope Lasisi & Gizem Uzuner & Ada Chigozie Akadiri, 2020. "Examining the causal impacts of tourism, globalization, economic growth and carbon emissions in tourism island territories: bootstrap panel Granger causality analysis," Current Issues in Tourism, Taylor & Francis Journals, vol. 23(4), pages 470-484, February.
    6. Waheed Ahmad & Sana Ullah & Ilhan Ozturk & Muhammad Tariq Majeed, 2021. "Does inflation instability affect environmental pollution? Fresh evidence from Asian economies," Energy & Environment, , vol. 32(7), pages 1275-1291, November.
    7. Axel Dreher, 2006. "Does globalization affect growth? Evidence from a new index of globalization," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1091-1110.
    8. Ulucak, Zübeyde Şentürk & İlkay, Salih Çağrı & Özcan, Burcu & Gedikli, Ayfer, 2020. "Financial globalization and environmental degradation nexus: Evidence from emerging economies," Resources Policy, Elsevier, vol. 67(C).
    9. Kirikkaleli, Dervis & Athari, Seyed Alireza, 2020. "Time-frequency co-movements between bank credit supply and economic growth in an emerging market: Does the bank ownership structure matter?," The North American Journal of Economics and Finance, Elsevier, vol. 54(C).
    10. Breitung, Jorg & Candelon, Bertrand, 2006. "Testing for short- and long-run causality: A frequency-domain approach," Journal of Econometrics, Elsevier, vol. 132(2), pages 363-378, June.
    11. World Bank Group, 2016. "World Development Report 2016 [Rapport sur le développement dans le monde 2016]," World Bank Publications - Books, The World Bank Group, number 23347, April.
    12. Kılıçarslan, Zerrin & Dumrul, Yasemin, 2017. "Foreign Direct Investments and CO2 Emissions Relationship: The Case of Turkey," Business and Economics Research Journal, Uludag University, Faculty of Economics and Administrative Sciences, vol. 8(4), pages 647-660, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Haifa Saadaoui & Mesut Dogan & Emna Omri, 2024. "The impacts of hydroelectricity generation, financial development, geopolitical risk, income, and foreign direct investment on carbon emissions in Turkey," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 26(2), pages 239-261, April.
    2. Atif Jahanger & Bo Yang & Wei-Chiao Huang & Muntasir Murshed & Muhammad Usman & Magdalena Radulescu, 2023. "Dynamic linkages between globalization, human capital, and carbon dioxide emissions: empirical evidence from developing economies," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(9), pages 9307-9335, September.
    3. Guan, Jialin & Kirikkaleli, Dervis & Bibi, Ayesha & Zhang, Weike, 2020. "Natural resources rents nexus with financial development in the presence of globalization: Is the “resource curse” exist or myth?," Resources Policy, Elsevier, vol. 66(C).
    4. Marc Audi & Marc Poulin & Khalil Ahmad & Amjad Ali, 2025. "Modeling Disaggregate Globalization to Carbon Emissions in BRICS: A Panel Quantile Regression Analysis," Sustainability, MDPI, vol. 17(6), pages 1-24, March.
    5. Hossain, Md. Emran & Islam, Md. Sayemul & Bandyopadhyay, Arunava & Awan, Ashar & Hossain, Mohammad Razib & Rej, Soumen, 2022. "Mexico at the crossroads of natural resource dependence and COP26 pledge: Does technological innovation help?," Resources Policy, Elsevier, vol. 77(C).
    6. Raghutla, Chandrashekar & Shahbaz, Muhammad & Chittedi, Krishna Reddy & Jiao, Zhilun, 2021. "Financing clean energy projects: New empirical evidence from major investment countries," Renewable Energy, Elsevier, vol. 169(C), pages 231-241.
    7. AhAtil, Ahmed & Bouheni, Faten Ben & Lahiani, Amine & Shahbaz, Muhammad, 2019. "Factors influencing CO2 Emission in China: A Nonlinear Autoregressive Distributed Lags Investigation," MPRA Paper 91190, University Library of Munich, Germany, revised 02 Jan 2019.
    8. Feng Zhao & Yinyin Zhang & Majed Alharthi & Muhammad Wasif Zafar, 2022. "Environmental sustainability in developing countries: Understanding the criticality of financial inclusion and globalization," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1823-1837, December.
    9. Mahmood, Ahmad & Zahoor, Ahmed & Xiyue, Yang & Nazim, Hussain & Sinha, Avik, 2021. "Financial development and environmental degradation: Do human capital and institutional quality make a difference?," MPRA Paper 110039, University Library of Munich, Germany, revised 2021.
    10. Zhao, Xinlu & Adebayo, Tomiwa Sunday & Kong, Xianli & Al-Faryan, Mamdouh Abdulaziz Saleh, 2022. "Relating energy innovations and natural resources as determinants of environmental sustainability: The role of globalization in G7 countries," Resources Policy, Elsevier, vol. 79(C).
    11. Jeremiah Msugh Tule & Peter Francis Offum & Ilham Haouas & Seyi Saint Akadiri & Olufunke Meadows, 2024. "Harmonizing renewable energy and economic growth in Sub-Saharan Africa: the transformative potential of ICT," International Economics and Economic Policy, Springer, vol. 21(3), pages 617-648, July.
    12. Ayodele Folorunso Oshodi & Godwin Olasehinde-Williams, 2025. "US Trade Policy Uncertainty and Nigeria’s Participation in Global Value Chains: Evidence from Frequency Domain Causality, Wavelet Coherence Analysis, and Time-Varying Causality," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(1), pages 189-214, March.
    13. Borice Augustin Ngounou & Edmond Noubissi Domguia & Thierry Messie Pondie & Joseph Pasky Ngameni & Linda Tiague Zanfack, 2025. "Military spending: An obstacle to environmental sustainability in Africa," Natural Resources Forum, Blackwell Publishing, vol. 49(1), pages 491-515, February.
    14. Lakshmana Padhan & Savita Bhat, 2025. "Analysing the role of globalisation, institutional qualities, and renewable energy consumption in environmental degradation mitigation: the SAARC experience," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(5), pages 10373-10397, May.
    15. Sethi, Pradeepta & Chakrabarti, Debkumar & Bhattacharjee, Sankalpa, 2020. "Globalization, financial development and economic growth: Perils on the environmental sustainability of an emerging economy," Journal of Policy Modeling, Elsevier, vol. 42(3), pages 520-535.
    16. Gao, Anna & Sun, Mei & Wen, Weixin, 2024. "Uncovering the spillover effects between the new energy industry and eleven economic sectors in China: Evidence based on stock data," Energy, Elsevier, vol. 301(C).
    17. Mutascu, Mihai, 2018. "A time-frequency analysis of trade openness and CO2 emissions in France," Energy Policy, Elsevier, vol. 115(C), pages 443-455.
    18. Shahbaz, Muhammad & Balsalobre, Daniel & Shahzad, Syed Jawad Hussain, 2018. "The Influencing Factors of CO2 Emissions and the Role of Biomass Energy Consumption: Statistical Experience from G-7 Countries," MPRA Paper 87456, University Library of Munich, Germany, revised 14 Jun 2018.
    19. Hanen Ragoubi & Zouheir Mighri, 2021. "Spillover effects of trade openness on CO2 emissions in middle‐income countries: A spatial panel data approach," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(3), pages 835-877, June.
    20. Shahbaz, Muhammad & Haouas, Ilham & SBIA, Rashid & Ozturk, Ilhan, 2018. "Financial Development-Environmental Degradation Nexus in the United Arab Emirates: The Importance of Growth, Globalization and Structural Breaks," MPRA Paper 87365, University Library of Munich, Germany, revised 11 Jun 2018.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:engenv:v:35:y:2024:i:6:p:2911-2934. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.