The Institutional Trilemma of Sustainable Development in Africa: Reconciling Digitalization, Entrepreneurship and Green and Inclusive Growth

View at publisher
Authors: Tao Huang, Ibrahim lanre Ridwan, Abdulateif A. Almulhim
Cited by: 3
References: 61

Abstract

ABSTRACT Africa faces an institutional trilemma in its pursuit of sustainable development: rapid digital expansion, rising entrepreneurial activity and persistent social–environmental fragilities coexist without delivering commensurate improvements in inclusive and green outcomes. This study investigates how digitalization and entrepreneurship jointly shape sustainable development in Africa and whether institutional quality reconciles this trilemma by enabling these forces to generate broad‐based socioeconomic and environmental gains. Using an unbalanced panel of 45 African countries over 2000–2023, the analysis integrates mediation, moderation, distributional heterogeneity, nonlinear threshold dynamics, temporal shifts and institutional‐regime subgroup robustness through advanced second‐generation estimators, including cross‐sectionally augmented autoregressive distributed lag, common correlated effects mean group, method of moments quantile regression and panel threshold regression. Three central findings emerge. First, digitalization significantly enhances inclusive growth and environmental efficiency, with entrepreneurship mediating a substantial share of these effects. Second, linear institutional moderation is weak; however, nonlinear enhancement effects and regime‐based subsample evidence demonstrate that digital and entrepreneurial gains materialize primarily after countries surpass a critical governance threshold. Third, distributional results show that digitalization delivers stronger benefits for lower‐performing economies, while institutional quality becomes increasingly decisive at higher performance levels and in more advanced digital phases. Overall, sustainable development in Africa depends not only on expanding digital access or promoting entrepreneurship but on strengthening governance capacity that aligns these forces toward inclusive and green transformation. The findings provide policy‐relevant insights for advancing SDGs 8, 9 and 13.

Fields of Study & Subjects

Economic Growth and Development Energy Environment Economic Growth Business and Economic Development

Publication details

Journal / source
Sustainable Development
Publisher
Wiley
Publication date
22 March 2026
Language
EN