Employment and financial inclusion in energy poverty reduction: evidence from negative synergies

Abstract

This study extends the attendant literature by assessing how financial inclusion moderates the incidence of employment on energy poverty in Ghana. The empirical evidence is based on interactive regressions within the remit of instrumental variables and pooled regressions. The findings show that negative synergies are apparent in the full sample and the male sub-sample, contrary to the rural, urban, and female sub-samples in which the findings are not significant to motivate the computation of net nexuses. It is important to note that negative synergies are apparent because the overall or net negative magnitude is higher than the corresponding unconditional negative magnitude of employment. Accordingly, it implies that while employment is negatively related to energy poverty, when employment is moderated with financial inclusion, the negative relationship tendency is higher. Policy implications are discussed, especially as it pertains to complementing employment strategies with financial inclusion measures in order to attain the UN SDG7 related to affordable and clean energy.