Sustainable Development Assistance and CO2 Emissions?

The study attempts to expose whether financial development assistance reduces carbon dioxide emissions in Sub-Sahara Africa or not. It introduces the consumer theory of utility maximization in explaining how financial sustainable development assistance shifts the country’s optimal consumption levels and it also attempts to introduce the Marshallian productivity theory in its suggested post-cure financial sustainable development assistance model (incentive-based approach). Empirically, the study estimates the random effects panel data model in two functional forms, the linear and the quadratic forms, linking carbon dioxide emissions to sustainable development assistance, per capita income, energy use and manufacturing share. In addition, it also estimates the dynamic panel data model, linking the current carbon dioxide emissions to previous emissions in SSA countries. The study findings provide evidence that the quadratic functional form in terms of the sustainable development assistance variable provides the best fit for SSA data.