The Impact of Financial Development on Fossil Energy Demand in West African Economic and Monetary Union (WAEMU) Countries: An Application of Pooled Mean Group Estimation on Non Stationary Panel Data

The objective of this study is to analyze the impact of financial development (variable of interest) on fossil energy demand (dependent variable) in West African Economic and Monetary Union (WAEMU) countries by Pooled Mean Group estimation on non-stationary dynamic panel data. We found that financial development and other control variables such as gross domestic product and industrialization impact significantly and positively fossil energy demand in WAEMU countries in the long run, the coefficient of urban population and foreign direct investment are also positive but not significant. In the short run however, only gross domestic product has a negative and significant impact on fossil energy demand in WAEMU countries.