Fossil fuel subsidies and health in sub-Saharan African countries: Exploring asymmetrical effects and transmission channels

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Résumé

Fossil fuel subsidies have increased in developing countries, especially in sub-Saharan Africa. High and rising energy prices, as well as the volatility of internationally traded energy prices, are justifications for such an increase. However, by lowering the price of fossil fuels through subsidies, governments are encouraging consumption levels that have consequences for health. The aim of this paper is to examine the asymmetric effects and transmission channels of fossil fuel subsidies on health in 35 sub-Saharan African countries from 2010-2020. The results of estimations via the Driscoll–Kraay method show that fossil fuel subsidies have asymmetric effects on health. A sustained increase in fossil fuel subsidies has a negative impact on health, whereas a decrease over time improves health. Private health expenditures and greenhouse gas emissions are channels through which these asymmetric effects are transmitted. These results imply the need to reform fossil fuel subsidies to move progressively towards clean energy and thus improve people's health.

Mots-clés

Fossil fuel subsidies, Health outcome, Asymmetric effects, Driscoll-Kraay, sub-Saharan Africa