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The Financial development-renewable energy consumption nexus in Africa: Does governance quality matter?

Author

Listed:
  • Toyo A. M. Dossou

    (Cotonou, Benin)

  • Dossou K. Pascal

    (Cotonou, Benin)

  • Emmanuelle N. Kambaye

    (Chengdu, China)

  • Simplice A. Asongu

    (Johannesburg, South Africa)

  • Alastaire S. Alinsato

    (Cotonou, Benin)

Abstract

Although the impact of financial development on renewable energy consumption has been extensively examined in recent years, the study regarding the moderation of governance quality on the financial development on renewable energy consumption nexus is sparse. By filling the gap in the energy economics literature, this study investigates the moderating effect of governance quality on the relationship between financial development on renewable energy consumption for a panel of 33 African countries over the period 2000-2020. The fully modified ordinary least square (FMOLS) estimation techniques has been used to account for the cointegration and cross-sectional dependence, respectively. The results unveil that the impact of governance quality and financial development on renewable energy consumption is negative and statistically significant. Moreover, the results reveal that the FD-governance quality interactions are significant and negative. Governance quality thresholds at which the negative incidence of financial development on renewable energy consumption is completely nullified are 0.825; 2.15; 2.86; 3.52;3.36; and 0,1, respectively

Suggested Citation

  • Toyo A. M. Dossou & Dossou K. Pascal & Emmanuelle N. Kambaye & Simplice A. Asongu & Alastaire S. Alinsato, 2024. "The Financial development-renewable energy consumption nexus in Africa: Does governance quality matter?," Journal of Africa SEER Centre(ASC) 24/011, Africa SEER Centre(ASC).
    • Handle: RePEc:dbm:wpaper:24/011
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    References listed on IDEAS

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    1. Angela Ujunwa & Chinwe Okoyeuzu & Nelson Nkwor & Augustine Ujunwa, 2021. "Potential Impact of Climate Change and Armed Conflict on Inequality in Sub‐Saharan Africa," South African Journal of Economics, Economic Society of South Africa, vol. 89(4), pages 480-498, December.
    2. Isaac Kwesi Ofori & Toyo Amègnonna Marcel Dossou & Seyi Saint Akadiri, 2023. "Towards the quest to reduce income inequality in Africa: is there a synergy between tourism development and governance?," Current Issues in Tourism, Taylor & Francis Journals, vol. 26(3), pages 429-449, February.
    3. Festus Fatai Adedoyin & Festus Victor Bekun & Kayode Kolawole Eluwole & Samuel Adams, 2022. "Modelling the Nexus between Financial Development, FDI, and CO 2 Emission: Does Institutional Quality Matter?," Energies, MDPI, vol. 15(20), pages 1-17, October.
    4. Hooman Peimani, 2018. "Financial Barriers to Development of Renewable and Green Energy Projects in Asia," Working Papers id:12891, eSocialSciences.
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    Cited by:

    1. Paidamoyo Mutepfa, 2025. "An Examination of FDI’s Moderating Effect on Finance, Growth and Energy Nexus in BRICS," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(6), pages 3278-3288, June.

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