The Nexus Between Population and Economic Growth in Sub-Saharan African Countries: Does the Level of Income Matter?
The Nexus Between Population and Economic Growth in Sub-Saharan African Countries: Does the Level of Income Matter?

Summary/Abstract: This study investigates the causal relationship between population growth and economic growth in 40 sub-Saharan African countries, using data spanning the period from 1980 to 2022. Departing from most of the previous studies, we employ two distinct proxies for population – total population and population density – to explore this relationship in a stepwise manner. In addition, we use a comprehensive set of modern panel data estimation techniques, including the heterogeneous panel Granger causality test, which accounts for both cross-sectional dependence and heterogeneity across countries in the panel. Our empirical findings reveal a bidirectional causal relationship between population and economic growth in the countries studied. In other words, both population and economic growth Granger-cause each other. This relationship holds for both low-income and middle-income countries and remains consistent regardless of the population measure used, whether it is the total population or population density. The study, therefore, concludes that the direction of causality between population and economic growth in sub-Saharan Africa is not contingent on the income level of the countries. The findings of this study suggest that policymakers should carefully consider the interplay between population size and economic growth when designing their economic policies and development strategies.

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