The study examined the effects of oil revenue on economic growth in Nigeria between 1980 and 2017. Time series data were sourced from secondary sources on Gross Domestic Product, Oil Revenue, Oil Rent and Domestic Price of Petrol. The analysis started by analyzing the descriptive statistics of the series and proceeded to examination of the stochastic characteristics of each time series by testing their stationary using Augmented Dickey-Fuller test. The ARDL model was used to estimate the coefficients of the parameters for both the short-run and the long-run. The F-statistics obtained from the bounds co-integration test shows a stable long run relationship between the variables. Findings from the study showed that in the long run, oil revenue and oil rent impacted on GDP positively although not significantly. In the short run however, both variables retarded economic growth in Nigeria. This goes a long way to show that the enormous windfall from crude oil in the nation has been mismanaged. The domestic price of petrol impacted positively on economic growth both in the long run and short run. The study therefore recommends a judicious use of the revenue generated from the oil sector to provide long term sustainable economic growth. In addition, due to the volatility and uncertainty in the oil sector in Nigeria, government should embark on a realistic diversification plan to alternative sectors of the economy to enhance the productive base of the nation seeing that crude oil is an exhaustible asset.
Agriculture as the largest sector in Nigeria has potentials of providing the country the desired foreign exchange earnings. This study therefore examined the effects of disaggregated agricultural output on foreign reserve in Nigeria for a 39-year time period spanning from 1981 to 2019. Time series data on foreign reserves, crop production, livestock, forestry, fishery and exchange rate were sourced from the Central Bank of Nigeria (CBN) statistical bulletin. The study adopted the econometric techniques of co-integration, error correction mechanism (ECM) technique and granger causality test to analyze the time series data. The Augmented Dickey Fuller stationarity test showed that the variables were stationary at first difference and second difference. The Johansen co-integration test results revealed the existence of a longrun relationship among the variables. The error correction model showed that crop production, livestock, forestry and fishery did not impact significantly on foreign reserve in Nigeria. The coefficient of ECM, which was rightly signed and significant, showed that in the event of shock or disequilibrium, the situation would go back to normal at the speed of 0.23 percent per annum. The granger causality test revealed that crop production and exchange rate had bi-directional causal relationships with foreign reserves while there was a uni-directional relationship between fishing and foreign reserves. The stability tests using the plots of the cumulative sum of recursive residuals (CUSUM) and cumulative sum of squares of recursive residual (CUSUMSQ) confirmed the stability of the model and as such can produce a reliable forecast. Based on these findings, the study recommends amongst others that the federal government should channel part of its ownership of foreign reserve in form of recoveries, grants and bilateral cooperation to crop production in Nigeria as this has potentials of improving the reserve in the economy.
This study examined the relationship between non-oil exports and economic growth in Nigeria for the period 1981 to 2019 using ARDL/Bounds testing approach to analyse data sourced from the CBN statistical bulletin.The ADF stationary test showed that all the variables attained stationarity after first difference except gross domestic product which was stationary at levels.The bounds test confirmed the existence of a long run association amongst the variables in the model.Non-oil export and economic growth were positively related in both the long run and short run. While the long run revealed an insignificant relationship, a significant relationship was observed in the short run. Trade openness showed evidence of positive and insignificant relationship with economic growth both in the long run and in the short run period while exchange rate revealed a positive and significant relationship with economic growth both in the long run and in the short run period. The R2 value indicates that 58 percent of the systematic variation in economic growth is explained by non-oil export, trade openness and exchange rate in Nigeria over the period under study. Based on these results, the study recommends: the diversification of the productive base of the nation to boost domestic capital formation needed for investment, prudent utilization of borrowed funds to reduce poverty to the barest minimum and more efficient debt management strategies to ensure that borrowed funds are directed to more productive channels in the economy to stimulate growth and improve the living standard of people.
The need to provide a level playing field for national economies has necessitated the integration of the economies through cross flow of goods, services, technologies and capital. These goods and services are produced by key sectors of the economy which represents the real sector. Over the years, the competitiveness of the real sector in the international market has raised concerns on the link between globalization and real sector performance. Consequent upon this, this study examined the impact of globalization on real sector output in Nigeria for a 39 year time period spanning from 1981 to 2019. The time series datasets used in this study were adapted from the Central Bank of Nigeria’s Statistical bulletin. The Ordinary Least Squares and Error Correction Modeling were used as the main analytical tools. The Augmented Dickey Fuller unit root test showed that all the variables attained stationary after first difference. The Johansen cointegration test further showed that the series have long run equilibri um relationship at 5 percent level of significance. The result from the errorcorrection model confirms that about 38 percent of the short run shocks in real sector output is corrected annually. From the estimates, a positive and statistically significant relationship exists between real sector output and foreign direct investment. Trade openness also was significant in impacting real sector output positively while a negative and significant linkage was observed between exchange rate and real sector output in Nigeria. The study therefore concluded that openness to trade broadens real output growth. Based on the findings, the study recommends amongst others that in the quest to maximize the benefits from trade openness, the relevant authorities should ensure that the nation’s exports are competitive and meet international standards by leveraging on modern technol ogies and innovation. Also, favourable industrial policies and strong institutional framework should be set up by the government to attract the right foreign direct investments.
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