THE NEXUS BETWEEN CARBON EMISSION AND ECONOMIC GROWTH IN NIGERIA

There has been a debate over the issue on the direction of causality between carbon emission and economic growth. However, literature gives more credence to carbon emission affecting or impacting economic growth and not the other way around. Therefore, this study examines the impact of economic growth (alongside its components) on carbon emission in Nigeria. The study employ autoregressive distributed lag (ARDL) model was used to analyze annual time series data. The key variables of interest are gross domestic product per capita, foreign direct investment, energy consumption, trade openness for the period of 1980 – 2020. The Augmented Dickey-Fuller (ADF) unit root test shows that all the variables are integrated of order one. From the bound test, we found a long run relationship among the variables. It was found that in the long and short run, log of gross domestic product per capita (LNGDPPC) has a positive insignificant impact on carbon dioxide emission in Nigeria. Based on the empirical results, there is no significant impact between LNGDPPC and carbon dioxide emission in Nigeria. Therefore, the study recommends that by adhering to international protocol, emission not connected to production activities should be taxed to reduce carbon emission in Nigeria.