Pathways to Bridging Income Gap in Africa: The Role of Energy Access and Quality Institutions
摘要
Addressing income inequality remains a major global and regional challenge, particularly in Africa where disparities are pronounced. This study explores how energy access and institutional quality can serve as pathways to reduce inequality, using data from 33 African countries between 2000 and 2022. While existing literature has largely focused on the direct effects of energy access and institutional quality on income inequality, the moderating role of institutional quality has received limited attention. This study addresses that gap by examining the synergistic effect of energy access and institutional quality on income inequality. The results from the instrumental variable two-stage least squares (IV-2SLS) with Driscoll-Kraay standard errors show that both electricity and clean energy access reduce income inequality, while institutional quality enhances income inequality in Africa. Interestingly, the results reveal that institutional quality forms synergy with energy access to further reduce income inequality. The findings challenge the Kuznets curve, which assumes inequality declines naturally with economic growth. We also identified that clean energy proves especially effective in highly urbanised settings. We recommend that efforts to strengthen institutional quality in expanding energy access should prioritise inclusivity, ensuring that underserved rural and urban communities are effectively reached.