Trade openness, hydroelectric power production, foreign direct investment and economic growth nexus in Nigeria
This study examines trade openness, hydroelectric power production, and foreign direct investment (FDI) nexus on economic growth in Nigeria. Despite efforts toward trade liberalisation, Nigeria’s growth remains constrained due to heavy reliance on oil and minerals exports. Furthermore, electricity p...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Taylor & Francis Group
2024-12-01
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| Series: | Cogent Economics & Finance |
| Subjects: | |
| Online Access: | https://www.tandfonline.com/doi/10.1080/23322039.2024.2426538 |
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| Summary: | This study examines trade openness, hydroelectric power production, and foreign direct investment (FDI) nexus on economic growth in Nigeria. Despite efforts toward trade liberalisation, Nigeria’s growth remains constrained due to heavy reliance on oil and minerals exports. Furthermore, electricity production challenges exacerbate these issues, hindering intra-African trade, FDI inflows, and overall economic growth. The study explores how trade openness and insufficient electricity production affects economic growth in the long run. The annual data from 1988 to 2022, sourced from the National Bureau of Statistics, Nigeria, Our World in Data, and the World Bank Development Indicator (WDI) database was used. The econometric techniques employed are the autoregressive distributed lag (ARDL) to examine long-run and short-run dynamics, while the dynamic ordinary least squares (DOLS) is used as a robustness to address potential endogeneity and serial correlation concerns. The findings indicate that trade openness positively affects long run economic growth, as supported by DOLS estimates. However, hydroelectric power production and FDI had mixed effects on Nigeria's economic performance. The study recommends prioritising investments in electricity infrastructure to enhance trade competitiveness and attract FDI. Moreover, diversifying exports beyond oil and minerals is crucial for strengthen economic resilience and drive sustainable development in Nigeria. |
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| ISSN: | 2332-2039 |