International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach

Amade Akpai Muhammed

doi:doi:10.11648/j.jbed.20220704.11

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International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach

Amade Akpai Muhammed

Published in Journal of Business and Economic Development (Volume 7, Issue 4)

Received: 22 September 2022 Accepted: 12 October 2022 Published: 8 December 2022

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Abstract

In this paper, the study investigates the impact of international trade on economic growth of Nigeria applying an Auto Regressive and Distributed LAG Bound Test Approach between the periods of 1980 to 2020. To actualize the objective of this study, we estimated GDP as a function of imports, exports, gross fixed capital formation, inflation and exchange rate. The paper employed ADF unit root test, Johansen co-integration test, error correction technique, and the Granger causality test. The estimated coefficients of the variables showed that all the employed variables are integrated of the same order 1(1) exception of inflation which was integrated of order 1(0). The bound test shows that there is proof of the presence of a long run correlation among the variables used while the causality test displayed that exports actually granger causes economic growth in Nigeria. The outcomes from estimation depicts that there is short run and long run effect of export trade on economic growth of Nigeria. Based on these findings, the study recommends that the government should embark upon import substitution strategy and aggressive diversification of the country’s economy by implementing policies that will encourage non-oil export, science and technology, manufacturing and agricultural sectors and in general promote the industrial growth of the economy.

Published in	Journal of Business and Economic Development (Volume 7, Issue 4)
DOI	10.11648/j.jbed.20220704.11
Page(s)	100-110
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2022. Published by Science Publishing Group

Keywords

Nigeria, International Trade, Economic Growth, Exports, Imports, ARDL

References

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APA Style

Amade Akpai Muhammed. (2022). International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. Journal of Business and Economic Development, 7(4), 100-110. https://doi.org/10.11648/j.jbed.20220704.11

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ACS Style

Amade Akpai Muhammed. International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. J. Bus. Econ. Dev. 2022, 7(4), 100-110. doi: 10.11648/j.jbed.20220704.11

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AMA Style

Amade Akpai Muhammed. International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. J Bus Econ Dev. 2022;7(4):100-110. doi: 10.11648/j.jbed.20220704.11

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@article{10.11648/j.jbed.20220704.11,
  author = {Amade Akpai Muhammed},
  title = {International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach},
  journal = {Journal of Business and Economic Development},
  volume = {7},
  number = {4},
  pages = {100-110},
  doi = {10.11648/j.jbed.20220704.11},
  url = {https://doi.org/10.11648/j.jbed.20220704.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jbed.20220704.11},
  abstract = {In this paper, the study investigates the impact of international trade on economic growth of Nigeria applying an Auto Regressive and Distributed LAG Bound Test Approach between the periods of 1980 to 2020. To actualize the objective of this study, we estimated GDP as a function of imports, exports, gross fixed capital formation, inflation and exchange rate. The paper employed ADF unit root test, Johansen co-integration test, error correction technique, and the Granger causality test. The estimated coefficients of the variables showed that all the employed variables are integrated of the same order 1(1) exception of inflation which was integrated of order 1(0). The bound test shows that there is proof of the presence of a long run correlation among the variables used while the causality test displayed that exports actually granger causes economic growth in Nigeria. The outcomes from estimation depicts that there is short run and long run effect of export trade on economic growth of Nigeria. Based on these findings, the study recommends that the government should embark upon import substitution strategy and aggressive diversification of the country’s economy by implementing policies that will encourage non-oil export, science and technology, manufacturing and agricultural sectors and in general promote the industrial growth of the economy.},
 year = {2022}
}

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TY  - JOUR
T1  - International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach
AU  - Amade Akpai Muhammed
Y1  - 2022/12/08
PY  - 2022
N1  - https://doi.org/10.11648/j.jbed.20220704.11
DO  - 10.11648/j.jbed.20220704.11
T2  - Journal of Business and Economic Development
JF  - Journal of Business and Economic Development
JO  - Journal of Business and Economic Development
SP  - 100
EP  - 110
PB  - Science Publishing Group
SN  - 2637-3874
UR  - https://doi.org/10.11648/j.jbed.20220704.11
AB  - In this paper, the study investigates the impact of international trade on economic growth of Nigeria applying an Auto Regressive and Distributed LAG Bound Test Approach between the periods of 1980 to 2020. To actualize the objective of this study, we estimated GDP as a function of imports, exports, gross fixed capital formation, inflation and exchange rate. The paper employed ADF unit root test, Johansen co-integration test, error correction technique, and the Granger causality test. The estimated coefficients of the variables showed that all the employed variables are integrated of the same order 1(1) exception of inflation which was integrated of order 1(0). The bound test shows that there is proof of the presence of a long run correlation among the variables used while the causality test displayed that exports actually granger causes economic growth in Nigeria. The outcomes from estimation depicts that there is short run and long run effect of export trade on economic growth of Nigeria. Based on these findings, the study recommends that the government should embark upon import substitution strategy and aggressive diversification of the country’s economy by implementing policies that will encourage non-oil export, science and technology, manufacturing and agricultural sectors and in general promote the industrial growth of the economy.
VL  - 7
IS  - 4
ER  -

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Author Information

Amade Akpai Muhammed

Department of Economics, Faculty of Social Sciences, Federal University, Lokoja, Nigeria

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Plain Text BibTeX RIS

APA Style

Amade Akpai Muhammed. (2022). International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. Journal of Business and Economic Development, 7(4), 100-110. https://doi.org/10.11648/j.jbed.20220704.11

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ACS Style

Amade Akpai Muhammed. International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. J. Bus. Econ. Dev. 2022, 7(4), 100-110. doi: 10.11648/j.jbed.20220704.11

Copy | Download

AMA Style

Amade Akpai Muhammed. International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach. J Bus Econ Dev. 2022;7(4):100-110. doi: 10.11648/j.jbed.20220704.11

Copy | Download

@article{10.11648/j.jbed.20220704.11,
  author = {Amade Akpai Muhammed},
  title = {International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach},
  journal = {Journal of Business and Economic Development},
  volume = {7},
  number = {4},
  pages = {100-110},
  doi = {10.11648/j.jbed.20220704.11},
  url = {https://doi.org/10.11648/j.jbed.20220704.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jbed.20220704.11},
  abstract = {In this paper, the study investigates the impact of international trade on economic growth of Nigeria applying an Auto Regressive and Distributed LAG Bound Test Approach between the periods of 1980 to 2020. To actualize the objective of this study, we estimated GDP as a function of imports, exports, gross fixed capital formation, inflation and exchange rate. The paper employed ADF unit root test, Johansen co-integration test, error correction technique, and the Granger causality test. The estimated coefficients of the variables showed that all the employed variables are integrated of the same order 1(1) exception of inflation which was integrated of order 1(0). The bound test shows that there is proof of the presence of a long run correlation among the variables used while the causality test displayed that exports actually granger causes economic growth in Nigeria. The outcomes from estimation depicts that there is short run and long run effect of export trade on economic growth of Nigeria. Based on these findings, the study recommends that the government should embark upon import substitution strategy and aggressive diversification of the country’s economy by implementing policies that will encourage non-oil export, science and technology, manufacturing and agricultural sectors and in general promote the industrial growth of the economy.},
 year = {2022}
}

Copy | Download

TY  - JOUR
T1  - International Trade and Economic Growth of Nigeria: An Auto Regressive and Distributed LAG Bound Test Approach
AU  - Amade Akpai Muhammed
Y1  - 2022/12/08
PY  - 2022
N1  - https://doi.org/10.11648/j.jbed.20220704.11
DO  - 10.11648/j.jbed.20220704.11
T2  - Journal of Business and Economic Development
JF  - Journal of Business and Economic Development
JO  - Journal of Business and Economic Development
SP  - 100
EP  - 110
PB  - Science Publishing Group
SN  - 2637-3874
UR  - https://doi.org/10.11648/j.jbed.20220704.11
AB  - In this paper, the study investigates the impact of international trade on economic growth of Nigeria applying an Auto Regressive and Distributed LAG Bound Test Approach between the periods of 1980 to 2020. To actualize the objective of this study, we estimated GDP as a function of imports, exports, gross fixed capital formation, inflation and exchange rate. The paper employed ADF unit root test, Johansen co-integration test, error correction technique, and the Granger causality test. The estimated coefficients of the variables showed that all the employed variables are integrated of the same order 1(1) exception of inflation which was integrated of order 1(0). The bound test shows that there is proof of the presence of a long run correlation among the variables used while the causality test displayed that exports actually granger causes economic growth in Nigeria. The outcomes from estimation depicts that there is short run and long run effect of export trade on economic growth of Nigeria. Based on these findings, the study recommends that the government should embark upon import substitution strategy and aggressive diversification of the country’s economy by implementing policies that will encourage non-oil export, science and technology, manufacturing and agricultural sectors and in general promote the industrial growth of the economy.
VL  - 7
IS  - 4
ER  -

Copy | Download