Demographic dividend and environmental sustainability: The mediation effects of economic growth, ICT, foreign direct investment, and urbanization

Abstract

The working-age population is essential to the process of economic growth, and there is growing interest in understanding the demographic dividend's role in sustainable development, particularly in response to the challenge of environmental sustainability. The routes, however, via which the demographic dividend is likely to affect environmental sustainability, are poorly understood. This paper has provided a new case for a better understanding of the asymmetric effects of demographic dividend on environmental sustainability in African countries. To this end, we employed Driscoll-Kraay standard error and Instrumental Variable Generalized Method of Moments (IV-GMM) for a panel dataset of 32 African countries from 1996 to 2018. The empirical findings show that demographic dividend deteriorates environmental sustainability via an increase in the ecological footprint. The results also show that urbanization, globalization and renewable energy reduce ecological footprint. However, economic growth and ICT increase ecological footprint. Lastly, our findings highlight that economic growth, ICT, urbanization and FDI are channels through which demographic dividend affects environmental sustainability. Therefore, although supporting economic growth, Africa's working-age population also contributes to some degree to environmental pressure.