Africa Countries’ Energy Efficiency: Evidence from a Directional Distance Function Approach

Abstract

Energy is recognized as the backbone of economic development while at the same time it is the most contributor to global warming. This paper aims to assess energy-efficiency of a sample of African countries over the period from 1971 to 2014. Through a directional distance function approach, we estimated both the energy efficiency and the environmental energy efficiency scores in the sample. The results showed that ignoring the undesirable output, i.e. dioxide carbon emissions associated with environmental degradation, overestimates countries’ energy inefficiency. Besides, from a non-parametric approach, we shed light on the sensitivity of countries environmental energy efficiency to the income level. Our findings confirmed the sensitivity of environmental-energy efficiency to the Kuznets curve hypothesis. In particular, countries with high-level income are the most environmental-energy efficient in the sample over the period of study. The paper ends with some policy implications and some research perspectives.