Geopolitical Risk, Globalization and Environmental Degradation in South Africa: Evidence from Advanced Quantiles Approach
Gold Olamide Lawal
School of Business, Westcliff University, Irvine, California, United States (United States)
Bisola Aladenika
School of Business, Westcliff University, Irvine, California, United States (United States)
Akadiri Akadiri
ssakadiri@cbn.gov.ngResearch Department, Central Bank of Nigeria, Abuja, Nigeria (Nigeria)
https://orcid.org/0000-0001-8901-7965
Ayodeji Samson Fatigun
School of Business, Westcliff University, Irvine, California, United States (United States)
Victoria Olushola Olanrewaju
Cyprus International University, Department of Business Administration, Faculty of Economics and Administrative Science (Cyprus)
Abstract
Sustainable development involves the incorporation of socio-economic concerns and environmental protection into the economic decision-making process, in such a way that, any developmental effort would eventually be favorable to immediate and future generations. It is against this backdrop this study investigates the effects of geopolitical risk and globalization on environmental degradation in South Africa over the period 1985Q1-2018Q4. This study improves on existing studies and raises concerns on the potential twin-effect of geopolitical risk and globalization on the environment. We deviate from the existing studies that make use of the mean causality approaches that do not consider possible dependence in the conditional tail of the series distribution. To examine whether the causality exists among the series, we make use of the novel Troster (2018) Granger non-causality in condition quantiles, which captures the pattern of causality in various quantiles. Empirical results show that there is feedback causality nexus between geopolitical risk and CO2 emissions. In majority of the quantiles, feedback causality is also observed between globalization and CO2 emissions. We find a bidirectional Granger causality nexus between geopolitical risk and environmental degradation, and between globalization and environmental degradation. Globalization and geopolitical risk negatively influence environmental degradation. We conclude that environmental degradation is not driven by globalization and geopolitical risk in South Africa, among other policy suggestions.
Keywords:
geopolitical risk, globalization, environmental degradation, advanced quantiles approach, South AfricaReferences
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Authors
Gold Olamide LawalSchool of Business, Westcliff University, Irvine, California, United States United States
Authors
Bisola AladenikaSchool of Business, Westcliff University, Irvine, California, United States United States
Authors
Akadiri Akadirissakadiri@cbn.gov.ng
Research Department, Central Bank of Nigeria, Abuja, Nigeria Nigeria
https://orcid.org/0000-0001-8901-7965
Authors
Ayodeji Samson FatigunSchool of Business, Westcliff University, Irvine, California, United States United States
Authors
Victoria Olushola OlanrewajuCyprus International University, Department of Business Administration, Faculty of Economics and Administrative Science Cyprus
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