Energy Consumption, Economic Growth and Environmental Quality in Burkina Faso: A Dynamic Trivariate Analysis

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Résumé

This paper analyses the dynamic nexus between energy consumption, economic growth and environmental quality in Burkina Faso using time series data over the period 1980 to 2019. The results of the long-run estimates through the Dynamic Ordinary Least Squares (DOLS), Fully Modified Ordinary Least Squares (FMOLS) and Canonical Cointegration Regression (CCR) methods show that the Environmental Kuznets Curve (EKC) hypothesis is not verified and that energy consumption negatively affects environmental quality. However, energy consumption has a positive effect on economic growth and economic growth also stimulates energy consumption. The results of the Granger vector error correction causality test indicate bidirectional causal relationships between energy consumption, economic growth and environmental quality. In terms of implications, these results suggest the need to strengthen energy policies to increase energy consumption and improve economic growth. However, it is important that these policies aim to change the structure of the energy mix in favour of less polluting energies. Renewable energy should therefore be encouraged through investments or subsidies in the sector in order to preserve the environment and promote sustainable economic growth.

Mots-clés

Energy consumption, Economic growth, Environmental quality, DOLS, FMOLS, CCR, Burkina Faso