The Influence of Export Diversification on Economic Growth: A Case of Southern African Development Community (SADC)

Matezo, Espoir Lukau; Makengo, Benjamin Mwadi; Muhole, Amantha Malimingi

doi:10.4236/ajibm.2021.117051

Cited by 8 publications

(5 citation statements)

References 20 publications

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“…Most of the empirical inquiries (Arize, 1996) focused attention on industrial and advanced (particularly, European, Asian, American) economies. In addition, available extant studies based exclusively on African/Nigerian data (Abdullahi & Jibir, 2018;Doki & Tyokohol, 2019;Duru & Ehidiamhen, 2018;Hesse, 2008;Hodey et al, 2015;Huseyin & Shuaibu, 2020;Johnson, 2016;Lugeiyamu, 2016;Matezo et al, 2021;Nwosa et al, 2019;Odularu, 2009;Oyelami & Alege 2018;Owan et al, 2020;Vakataki'Ofa et al, 2016;Yuni et al, 2020) that have examined the nature of the relationship between export diversification and economic growth have focused mainly on investigating the growth impacts of overall export diversification which by its nature have been far from being definitive on comparative analysis of the effects of export diversification at intensive and extensive margins on growth. Specifically, no known study has been reported exclusively for Nigeria.…”

Section: Review Of Related Studiesmentioning

confidence: 99%

Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy

Young

2023

Foreign Trade Review

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Two opposite strands of literature analysing export diversification’s role in promoting sustainable growth have evolved in international economics and development, namely, the intensive and extensive margins of exports. This study empirically investigates which of the margin is more useful towards promoting sustainable growth using annual time series data of Nigeria for the period 1960–2021. Autoregressive distributed lag (ARDL) and innovative accounting procedure were employed. The ARDL results reveal that both margins significantly enhance growth in short and long run. However, importance of the extensive margin, in aggregate, dominates that of the intensive margin. Likewise, the results from innovative accounting procedures reveal that although both margins contribute positively to growth, the contribution to growth of extensive margin dominates over that of the intensive margin. These results, thus, lend credence to the extensive-margin exposition, which postulates that the export of extant commodities to new market destinations or export of new commodities to new and/or old market destinations plays a relatively more important role in export growth/diversification and, ultimately, sustainable growth. The study recommends that governments should develop and implement economic policies aimed at enhancing exports of value-added commodities—due to their relatively high income and price elasticities over primary commodities—to maximise the benefits in the extensive margin. JEL Codes: F10, F14, O10, O12, O50, O55

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Section: Review Of Related Studiesmentioning

confidence: 99%

Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy

Young

2023

Foreign Trade Review

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“…Espoir et al [8] examined "the impact of export diversification on economic growth in the Southern African Development Community (SADC) using the GMM approximation technique, while capturing time-series variations in the data, country-specific time-invariant effects, and controlling for endogeneity in the estimation model." The results showed that export diversification frameworks have a significant impact on economic growth.…”

Section: Empirical Reviewmentioning

confidence: 99%

Impact of Export Diversification on Economic Growth in Sub-Saharan Africa (SSA)

Ajayi

2023

SAJSSE

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This study investigated the impact of export diversification on the economic growth of countries in Sub-Saharan African (SSA). Trade Data are gathered from the World Integrated Trade Solution (WITS), and UN Comtrade database, using a 6-digit level range of the Standard International Trade Classification (SITC) and the Harmonised System (HS) for the Countries. Export diversification Indices data are proxies from the Herfindahl Hirschman Index (HHI) which represents the level of export product diversification for all forty-eight (48) SSA Countries between 1995 and 2020. The Panel Autoregressive Distributed Lagged Model (P-ARDL) was applied in the study. Other analysis including correlation analysis, multicollinearity, and Unit Root tests were used to achieve the objective of the study. The findings showed that export diversification has not really benefitted the SSA Countries; also, exporting raw materials and other primary products does not benefit the region, and therefore, the countries should continue leveraging on the potential of diversifying their exports and exploring sectors such as the manufacturing to attain more economic gains. To achieve export gains, oil/minerals products should be exported as finished products, not as raw materials, especially, from those nations that are resources endowed. These raw materials should be best used domestically to aid production into finished/refined products for subsequent exports.

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“…Diversification of the economy means forming newly created added value (or GDP) in the country during the year, not in one or two areas but in a larger number of areas. Diversification of exports means the wide variety of products exported by the country to world markets, as well as the provision of the product (service), country, and regional diversity of export markets (Matezo et al, 2021;Makhlouf et al, 2015). Export diversification is a set of policies that involve changing the specific weight of individual goods in the existing export basket, offering new goods to the export basket, and gaining access to new geographic markets (Al-Marhubi, 2000; Bahar & Santos, 2017;Mau, 2016).…”

Section: Literature Reviewmentioning

confidence: 99%

Economic diversification as a factor of sustainable development: A case of Azerbaijan

Huseynov

Hamidova

Samedova

2023

Problems and Perspectives in Management

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In modern conditions, the one-sidedness in the economy of Azerbaijan makes it necessary to accelerate the diversification process of the country’s economy. From this point of view, the development of the non-oil sector in the country presents the main priority of the government’s economic policy in Azerbaijan. The purpose of the study is to investigate ways of ensuring the diversification of the national industries in Azerbaijan, which aims to move to a new economic growth model in modern conditions. The study analyzes the economy’s current state and export diversification level in Azerbaijan using the Herfindahl-Hirshman index. As a result of the analysis, the level of diversification in Azerbaijan’s economy and exports was found to be very low (in 2021, the Herfindahl-Hirshman index was 0.23 for the economy and 0.79 for exports). The findings indicate that cooperation between the state and business plays a significant role in increasing the diversification of the economy following the goals of sustainable development of Azerbaijan. On the other hand, it helps stimulate entrepreneurship development in the non-oil sector. One of the ways to solve existing problems in this area is to create Eximbanks to increase the country’s export capabilities of non-oil products. The study offers recommendations to speed up the process of diversification of the economy in Azerbaijan and increase its efficiency.

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The Influence of Export Diversification on Economic Growth: A Case of Southern African Development Community (SADC)

Cited by 8 publications

References 20 publications

Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy

Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy

Impact of Export Diversification on Economic Growth in Sub-Saharan Africa (SSA)

Economic diversification as a factor of sustainable development: A case of Azerbaijan

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