The club convergence of green productivity across African countries

Shen, Zhiyang; Shao, Anqi; Chen, Jiayi; Cai, Jinyang

The club convergence of green productivity across African countries

2022

Shen, Zhiyang | Shao, Anqi | Chen, Jiayi | Cai, Jinyang

This study investigates economic convergence and sustainable development in Africa. By introducing an aggregate production technology and directional distance function, it examines the productivity growth of 28 African economies from 1990 to 2019. The proposed approach considers all decision-making units (countries) as a whole, and the productivity gains are then estimated under a nonparametric framework. In the empirical analysis, the carbon emissions are included in the Luenberger productivity measurement, called green productivity. The results show that the annual average growth rate of green productivity is 1.51% in African, and different types of club convergence for green productivity indicator and its decomposition are observed during the sample period. The decomposition of the Luenberger indicator shows that green African growth is mainly driven by technological progress, not efficiency change. Furthermore, the overall inefficiency is decomposed into technical and structural effects. The latter measure the potential improvement in terms of resource reallocation. Structural inefficiency is larger than technical inefficiency, suggesting that African countries could improve their economic and environmental performances by optimizing input/output mixes.

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