International Trade and Economic Growth in Nigeria (Published)
This study evaluated the impact of international trade on economic growth in Nigeria from 1986 to 2021.The variables used in this study comprised of gross domestic product as a dependent variable, while oil exports, non-oil exports, oil imports, non-oil imports and exchange rate are the explanatory variables. The employed variables have different order of integration ranging from zero and one, which led to the application of auto-regressive distributed lag (ARDL) model as the method of analysis. The ARDL model investigated long-run and short-run interactions among the variables. The results showed evidence of co-integrating equations amongst the variables. Hence, the key findings that satisfied the research objectives are (i) oil exports have significant positive impact on economic growth in Nigeria in both short-run and long-run. (ii) Non-oil exports exerted positive and significant influence on economic growth in Nigeria in both short-run and long-run. (iii). Oil imports negatively and significantly affected the growth rate of the Nigeria’s economy and (iv) non-oil imports affect the economic growth in Nigeria negatively and insignificantly in both the short-run long-run. The results imply that N1 rise in oil exports increases economic growth by N0.089 in the short-run and by N0.376 in the long-run; whereas N1 rise in non-oil exports increases economic growth by N0.047 in the short-run and N0.199 increase in the long-run. However, N1 rise in oil imports, decreases economic growth by N0.019 in the short-run and N0.092 decrease in the long-run; whereas N1 rise in non-oil imports, decreases economic growth by N0.022 in the short-run and N0.92 decrease in the long-run. Based on the findings, the study recommended that Nigerian government should make judicious use of proceeds from export of crude oil to diversify other productive sectors of the economy. Again, the activities of non-oil sectors like agriculture, industry, etc, should be stimulated to enhance non-oil exports in Nigeria.
Keywords: Exports, Imports, International Trade, Nigeria, economic growth
Monetary Policy Operation and Economic Growth in Nigeria: Evidence from 1990 – 2022 (Published)
The study examined monetary policy operations and economic growth in Nigeria from 1990 to 2022. The primary purpose is to evaluate the impact of monetary policy operations on Nigeria’s economic growth. The data for the study were obtained from National Bureau of statistics (NBS) databased and Central Bank of Nigeria CBN statistical bulletin. The econometric methods of OLS, Co-integration, Variance Error Correction Mechanism (VECM) and Vector Error Correction Model (VECM) were employed to examined the interplay among the critical variables. The natural log of real GDP was employed as the variable of interest while exchange rate and inflation rate as instrument of monetary policy operations. The result of the VECM shows that the overall model is satisfactory given the coefficient of determination of 34 percent and f-statistics of 3.37. The study discovered that the explanatory variables were not statistically significant at 5% level in stimulating economic growth in Nigeria. However, the long run dynamic result also shows that there exists a long-run relationship or equilibrium among the variables. The result of VARM revealed that exchange rate has positive coefficients, indicating a positive relationship with the lagged RGDP. The model has a moderately high R-squared value (0.9429), indicating a reasonably good fit. While inflationary rate indicates negative coefficients with the lagged exchange rate. The model has a lower R-squared value (0.2862), indicating a weaker fit to the data. These finding hold significant implications for the Nigerian economy, highlighting the effectiveness of monetary policy, the importance of exchange rate stability, and the imperative of inflation control in promoting sustained economic growth. Policymakers are urged to prioritise evidence-based decisions, long-term planning, and target interventions to harness the full potential of monetary policy in driving sustainable economic development in Nigeria.
Keywords: Exchange Rate (EXR), Inflation Rate (IFR), Monetary Policy, Real Gross Domestics Products (RGDP), economic growth
Public Expenditure, Official Development Assistant and Economic Growth: A Time Series Analysis for Nigeria (1981 – 2018) (Published)
In addition to divergent views of economists on the effect of public expenditure on economic growth, results of existing empirical studies in developed and developing economies has remained inconclusive and tends to depend on the period of study, econometric method, nature of data and the composition of government expenditure. In this study, public expenditure in Nigeria is decomposed into domestic and the foreign receipts components. The domestic component comprises capital expenditure (GCE) and recurrent expenditure (GRE) while the foreign receipts component captures foreign inflow of official development assistance (ODA). Employing extended aggregate production function framework and bound test approach (ARDL model), this study examined the impact of each of these three components of public expenditure (GCE, GRE and ODA) on economic growth in Nigeria for the period (1981- 2018). The findings of this study indicate the existence of a long run relationship between the macroeconomic variables estimated in the model. The recurrent expenditure (GRE) has positive impact on economic growth both in the short-run and in the long-run, countering the widely held view that government consumption spending is growth-reducing. The capital expenditure (GCE) and official development assistance (ODA) have negative impact on economic growth in Nigeria both in the short-run and long-run. The granger causality test result shows no causal relationship between GDP and GCE and between GDP and ODA, but a bi-directional causal relationship exists between GDP and GRE. It is recommended that greater percentage of public fund should be expended as capital expenditure and such fund should be properly utilized on acquisition of physical capital and social overhead capital like transportation, electricity, communication, irrigation, flood control, research and human capital development, capital formation in agricultural and industrial sectors to enhance the productive capacity of the economy. ODA in recent times has been unreliable source of finance in Less Developed countries, hence Nigeria should not heavily depend on it. However, whatever ODA is received should be properly utilized and channel into productive projects which have significant positive impact on economic activities and wellbeing of the populace. The fight against corruption in the country should be frontally confronted to free more public fund for collective development purposes in the country.
Keywords: Capital Expenditure, Nigeria, Official Development Assistance, Public expenditure, Recurrent Expenditure, economic growth
Revenue Per Capita and Economic Growth Nexus: Building a New Revenue Framework for Nigeria (Published)
The challenging consequences of poor economic performance across most emerging economies is a reflection of the weak public revenue management system. Hence, the study into Revenue per capita and Economic growth nexus: Building a new revenue framework for Nigeria. The study employed the Parsimonious Error Correction Model (ECM) for adjusting the parameters of auto regressive distributed lag (ARDL) model to examine the outcome of economic growth, proxy of real gross domestic product (RGDP) on Revenue per capita, proxy of gross national product per capita(GNPPC); gross fixed capital formation (GFCF); and Inflation rate (INFR). The finding revealed a significant positive relationship between GDP and its lagged value, as well as GNPPC. Whereas, a negative but significant impact subsist between GDP and lagged value of GNPPC; while, an insignificant negative impact exists between GDP and GFCF and its lagged value. Inflation rate exhibited a moderate significant inverse relationship with economic growth during the review period. Based on the finding, It was recommended among others: tax revenue generating agencies should pursue fiscal sustainability by rethinking Nigeria’s tax policy mix and design to consummate enduring prosperity for Nigerians.
Citation: Opuala-Charles S. and Orji J.O. (2022) Revenue Per Capita and Economic Growth Nexus: Building a New Revenue Framework for Nigeria, International Journal of Development and Economic Sustainability, Vol.10, No.6, pp.1-17
Keywords: Investment, Tax Revenue, economic growth, revenue per capita
The Evolution of Privatization in Brazil: The Case of Embraer (Published)
State participation in the economy has been intensely debated over the past three decades. In Brazil, especially after the advent of the Federal Constitution in 1988. Privatization in Brazil, however, was instituted by Law 8.130/90, which established the National Plan for Privatization, aiming at transferring to the private sector activities unduly exploited by the public sector. In this article, we investigated one of the most significant privatizations in Brazilian history, the case of Embraer, the world’s third largest civil aircraft manufacturer. Key findings pointed out a complex privatization process, including golden share vetoes and institutional challenges faced by Embraer, such as the first Brazilian company to adopt the International Financial Reporting Standards (IFRS) fully. In addition, the careful analysis suggested implications for the reduction of public debt. Also, the resumption of investments in companies and activities transferred to the private sector, modernization of the country’s industrial park, increasing its competitiveness, and reinforcing business capacity in Embraer’s jet C-series sector and military aircraft, for instance. Also, implications for the public administration to focus its efforts on actions where the State’s presence is necessary for achieving national priorities. Finally, the strengthening of the capital market, as well as the democratization of the ownership of the capital of Embraer are topics to be debated in the present article.
Keywords: Foreign Direct Investments, National Security, Privatization, civil aviation, economic growth
Impact of Insecurity on Nigerian Economic Growth and Development (Published)
This paper examines insecurity challenges and implications on business activities, economic growth and economic development of Nigeria. The study was designed as ex-post factor research, with time series data sourced from official and government publications; spanning from 2009 to 2022. The variables used for the study were sourced after adequate considerations of extant literature and objectives of the study. In meeting with the objectives of the study, we logically break-up the data into pre-high insecurity period (2009- 2015) and high insecurity period (2016- 2022). Four hypotheses were formulated and tested using t-test, f-test; and Cho-test was used to test the variance between the two time periods under study. The study found that insecurity hampers Business Activities (BA) but does not have significant influence on Economic Growth (EG) and Economic Development (ED) of Nigeria; and concluded that national insecurity must be of high consideration as business activities blossom in a secure environment, which ultimately ensures sustainable economic growth and development. We therefore recommend a synthesis of composite security management approach model and two-way approach model in addressing the ills of insecurity in ensuring Nigeria economic sustainability.
Citation: Agogbua, Stanley Ndubisi; Mgbatogu, Chukwudi D. and Nzewi, Ugochukwu C. (2022) Impact of Insecurity on Nigerian Economic Growth and Development, International Journal of Development and Economic Sustainability, Vol.10, No.5, pp.1-13
Keywords: Economic Development, Foreign Direct Investment, Gross Domestic Product, Insecurity, Per Capita Income, business activities, economic growth
Valuing the Joint Effect of Adult Literacy and Economic Growth on Renewable Energy Consumption in African Zone (Published)
Renewable energy has been considered as the optimistic sources generating from natural resources, able to restock easily and without harming environmental damages, ensures enviornemntal sustainability. In the developing and underdeveloped economies, renewable energy accelerates the wheel of economic growth and development with enhancing the new innovation and enhancing the life-standard of people. The paper aims to investigate the effect of independent variables (General and Socio-economic basis) on consuming renewable energy in zonal-wise. Moreover, the author wants to investigate the joint effect of economic growth (EG) and average literacy rate (ALR) on consuming renewable energy on time-series database from World Bank (WB). Lastly, after measuring joint hypothesis, it is investigated that EG*ALR has joint effect on model in North African Zone (NAZ), Eastern African Zone (EAZ) and Western African Zone (WAZ).
Citation: Tanbir Hossain (2022) Valuing the Joint Effect of Adult Literacy and Economic Growth on Renewable Energy Consumption in African Zone, International Journal of Development and Economic Sustainability, Vol.10, No.4, pp.52-73
Keywords: Renewable Energy, Sustainability, average literacy rate, economic growth
Rising Youth Unemployment and The Socio-Economic Realities in Nigeria: The Akwa Ibom State Experience (Published)
This paper was undertaken to establish the interplay between youth unemployment and resultant negative socio-economic realities in Nigeria as evident in Akwa Ibom State. Nigeria’s population and that of Akwa Ibom State is currently (July, 2022) estimated at about 206 and 7 million respectively with a progressive average growth rate of 3.5 percent per annum. Out of this number, while more than 35 percent at the national level, over 52 percent of the youth in Akwa Ibom State are unemployed. This situation, as the paper observed, is occasioned by crucial factors ranging from the poor state of the economy and educational standard, poor attitude to agriculture, poor enabling and secured environment, scarcity of data on informal employment and entrepreneurship, poor economic growth rate and wrong impression about technical and vocational education. Furthermore, the paper noted that the prevailing unemployment among youth in Akwa Ibom State has engendered high rate of social vices such as prostitution, armed robbery, oil bunkering, internet fraud, drug trafficking and addiction, rape, kidnapping, political thuggery, assassination and other acts of criminalities. For the way forward, the paper proffered, among others, that the Akwa Ibom State government should redesigned the education sector to become technology-based in order to enhance skill acquisition for self-employment as well as encourage the youth to embrace agriculture as a profitable business venture. Moreover, honest effort should be made towards revitalizing the moribund and ailing industries in the state.
Victor E. Ita and John E. Bassey (2022) Rising Youth Unemployment and The Socio-Economic Realities in Nigeria: The Akwa Ibom State Experience, International Journal of Development and Economic Sustainability, Vol.10, No.4, pp.1-14
Keywords: Entrepreneurship, Self-employment, Unemployment, Youth, economic growth, social vices
Assessing The Socio-Economic Impact of Coronavrius in Africa (Published)
The looming health shock of coronavirus could have disastrous impacts on the continent’s already strained health systems, and could quickly turn into a social and economic emergency. This paper, therefore, intends to assess the effects of coronavirus on Africa economies. (using its growth implication) Based on the endogenous growth theoretical approach, the link between life expectancy, poverty incidence, and economic growth was estimated using the GMM technique of analysis with 32 selected Africa countries. Findings showed that coronavirus exhibited negative and substantial impact on socio-economic situation and macroeconomic variables in Africa such as inflation, unemployment, poverty rate and economic growth, amongst others. The result ascertained that the government expenditure significantly increased during the period in a bid to curb the pandemic, but household welfare degenerated and was negatively affected with high poverty rate, this paper recommended that the government of the Africa countries should diversify the revenue base of their economies to cushion the effect of unprecedented shock due to the pandemic and provide adequate relief materials to pad the effect of loss of income to the poor and vulnerable, support in the implementation of structural reforms to enable them to build capacity and generate sufficient domestic resources or fiscal buffers to effectively manage pandemics.
Keywords: Socio-Economic, and coronavirus, economic growth
Exchange Rate Fluctuations and Economic Growth in Nigeria (1981 – 2020) (Published)
This study examined the relationship between exchange rate and economic growth in Nigeria between 1981 and 2020. The specific objectives are to determine the effects of exchange rate, inflation and interest rate on gross domestic product (GDP). The data on the variables were obtained from the Central Bank of Nigeria (CBN) Statistical Bulletin and World Development Indicators, and analyzed using descriptive statistics, unit root as well as bounds cointegration tests and ARDL model. The unit root test results showed that the variables are mixed integrated. While inflation is stationary at levels, the other variables in the model were stationary at first difference. The bounds cointegration test showed that long run relationship exists between GDP growth and the underlying explanatory variables. The findings showed that exchange rate and inflation negatively impacted on economic growth. This finding indicates that increase in exchange rate and price level is detrimental to the growth of the Nigerian economy. There is evidence of a significant positive effect of interest rate on GDP growth. This finding explains the reality in Nigeria, where businesses and households tend to borrow even as interest rate increases, but tend to cut corners by reducing the quality of their products and services or pass-on the increased costs of borrowing to consumers by increasing prices. Given the findings, this study recommends amongst others that the federal government through the CBN should ensure that exchange rate policy should is consistent to provide opportunity for a realistic and stable exchange rate capable of driving economic growth in Nigeria.
Keywords: Exchange Rate, Inflation Rate, Interest Rate, economic growth