Can the resource curse be avoided? An empirical examination of the nexus between crude oil price and economic growth

Abstract

This paper revisits the resource curse hypothesis by examining the nexus between crude oil price and economic growth for a panel of 32 Sub-Saharan Africa countries from 1980 to 2017. Employing the panel vector autoregression (VAR) estimation technique, we found evidence of a significant positive effect of crude oil price on economic growth both in the short run and long run. However, after splitting the panel into net oil exporters and importers, the results for net oil importers remain consistent with those obtained for the whole panel, unlike those for net oil exporters revealing a positive and negative effect of crude oil price on economic growth in the short-run and long-run periods, respectively. This confirms the resource curse hypothesis for oil-exporting countries under consideration. Moreover, we found evidence of bidirectional causality between crude oil price and real GDP. Consequently, to boost economic growth in Sub-Saharan Africa, various governments should encourage economic diversification, increase investments in human capital in view of enhancing the development of the oil sector by ensuring an efficient management of oil revenues, as well as intensifying the fight against corruption. Supplementary Information The online version contains supplementary material available at 10.1007/s43546-021-00179-x.

Women empowerment and environmental sustainability in Africa

“…Nevertheless, the results further reveal that natural resources, population density and the rule of law are environmentunfriendly, as evidenced by their significant positive coefficients. This environment degrading nature of natural resources is consistent with recent findings by Miamo and Achuo (2022) in the context of sub-Saharan African countries. Moreover, although trade openness equally leads to environmental degradation, its effect is however insignificant.…”

“…Therefore, government trade policy may play a great role in empowering women economically. Equally, an enabling business environment can act as an incentive to foreign investors thereby attracting Foreign Direct Investments (FDI) which have proven to be growth enhancing in sub-Saharan Africa (Miamo and Achuo, 2022). Moreover, enhanced growth is likely going to improve the livelihoods of the population, although with some attendant environmental concerns.…”

“…Equally, the last column in Table 3 shows the system GMM results of the CO2 model. Given that this study employs the GHG emissions as a proxy for environmental quality unlike other recent studies (Asongu et al, 2021;Dinga et al, 2021;Miamo and Achuo, 2022) that use CO2 emissions as a proxy for environmental quality, it was necessary for us to estimate another model to check for the robustness of our results. Consequently, the results from the CO2 emissions model remain consistent with our baseline results.…”

Macroeconomic effects of crude oil shocks: Evidence from South Asian countries

“…Oil, which accounts for one-third of global energy consumption, is regarded as the primary energy source. Miamo and Achuo (2021) found a two-way causal relationship between GDP and crude oil prices. They recommended that to stimulate economic growth, the government should spend more on human capital, promote economic diversification, expand the oil sector, manage oil revenues effectively, and step-up efforts to combat corruption.…”

Trade shocks and labour market resilience in Sub-Saharan Africa: Does the franc zone response differently?

“…This work applies the panel VAR using the GMM style. This framework has been set up by of Abrigo and Love (2016) and used in several studies (Berdiev and Saunoris, 2016;Gnimassoun and Mignon, 2016;Topcu et al, 2020;Miamo and Achuo, 2022). The panel VAR structurally contains two techniques, namely the impulse-response functions (IRF) and the forecast error variance decomposition (FEVD) analysis.…”