This study aims to reinvestigate the impact of economic growth in relation with trade openness, financial development, energy consumption and foreign direct investment to overcome the omitted variable problem on environmental degradation in Nigeria for the years from 1971 to 2015. Bounds test results reveal a cointegrating relationship between variables in the long run. Both in the long and short run, economic growth tends to affect CO 2 emissions positively. In the long run, energy consumption positively impacts CO 2 emissions while CO 2 emissions tend to be negatively affected by foreign direct investment. Furthermore, a robust check was performed through the FMOLS and DOLS to establish the long run effect. Moreover, we employed wavelet coherence based causality test which provided stronger supportive evidence to the long-run estimations of this study. The significance of this study stems from the uniqueness that to the best of our knowledge there has been no study combining these variables in addition to the fact that the econometric techniques employed have not been applied in conjunction to the subject for the case of Nigeria.
This study aims to reexamine the interconnection between economic growth, foreign aid, trade, gross fixed capital formation, and inflation rate in one model for the case of Nigeria, which has not yet been analyzed utilizing the new econometric techniques, employing time series data covering the years between 1980 and 2018. No previous research has employed a wavelet coherence technique to gather information on the dynamic connection and/or causality between these economic indicators at dissimilar frequencies and various time frames. The main objectives are to address the questions: (a) Is there long‐run relationship between the indicators under consideration? (b) What are the main determinants of economic growth in the long run? (c) How are the indicators related at dissimilar frequencies and various time frames? The empirical findings confirm that (a) there is a long‐run relationship between the indicators under consideration; (b) in the long run, economic growth is influenced significantly by foreign aid, trade openness, gross fixed capital formation, and inflation rate; (c) the outcomes of the wavelet coherence technique give evidence to support the long‐run estimations of this study; and (d) the outcomes of wavelet coherence are supported by the Toda‐Yamamoto causality test results.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.