Assessing the nexus between industrialization and inclusive green growth in Africa. The critical role of energy efficiency

Abstract

The literature on the effects of industrialization shows that it boosts productivity, creates jobs, enhances workforce skills, and contributes to social stability. However, its effects on inclusive green growth are quite rare in the literature. This study endeavors to fill this research gap by proposing one of the first empirical analyses, linking industrialization and inclusive green growth in a sample of 42 African countries over the period 2000–2020. This study also examines whether energy efficiency can generate a positive synergy with industrialization to foster inclusive green growth in Africa. To this end, we develop an innovative assessment framework to measure Africa's inclusive green growth, covering three dimensions: economic, social, and ecological sustainability. Empirical analysis shows that industrialization reduces inclusive green growth. In addition, energy efficiency has a positive effect on inclusive green growth. Interestingly, energy efficiency mitigates the negative effect of industrialization on inclusive green growth. Based on these results, some economic policy implications are discussed.