What drives Angola's economic growth? New evidence from the roles of urbanization and industrial growth

Abstract

AbstractThis study examines the impacts of urbanization, industrial growth, and carbon emissions on Angola's economic growth by employing annual time series data from 1991 to 2020. This intends to strengthen Angola's economic policies using the Autoregressive Distributive Lag (ARDL) bounds test approach, Johansen cointegration, and vector error correction model (VECM). The results show that: (1) Economic development will be realized at the expense of environmental protection; (2) carbon emissions and industrial growth reinforce the country's economic growth in the short and long runs, while urbanization has no vital influence on economic growth; and (3) a bidirectional causality between economic growth and carbon emissions and a unidirectional causality relationship ranging from urbanization and economic growth to industry value‐added. Our findings encourage the country's leaders to consider urbanization and industrial growth while reducing carbon emissions. The country's priorities should be skills training, developing clean technologies, gradually increasing renewable energy share in the mix of energy, and encouraging industries to turn to clean energy.