Does Resource Dependency Undermine Environmental Sustainability? Evidence from Resource-Intensive and Non-Resource-Intensive West African Economies

Abstract

The current study examined the environmental effect of natural resource extraction in 15 West African countries for the period 1980-2024. Despite the growing literature on resource-environment dynamics, only a few studies have explored the comparative effects between resource-intensive countries (RIC) and non-resource-intensive countries (NRIC). For this reason, this paper focuses on the comparative analysis of West Africa’s RIC and NRIC. Unlike most resource-environment studies, this study utilized the load capacity factor as a comprehensive environmental quality indicator. With the use of the panel-corrected standard error technique and load capacity curve (LCC) hypothesis, the study found the RIC to validate the U-shaped LCC hypothesis, while the NRIC invalidates the LCC hypothesis (inverted U-shaped). Also, the results showed that natural resource intensifies environmental quality in West Africa regardless of its resource group. Further, while renewable energy increases environmental quality, industrialization induces environmental damage in West Africa regardless of its resource group. The study recommended that policymakers should design growth strategies that integrate environmental sustainability, especially in the whole sub-region and RIC, where early-stage growth stresses ecosystems. Also, governments in West Africa should efficiently manage the revenue gotten from their resource rents, thereby allocating some portion for environmental protection projects and clean technological adoption.