Nigerian Economic Society
Hi Guest,
Home | Paper Submission | Signup |
Providing intellectual leadership in economic management in Nigeria



Abstract: Research on the nexus between export diversification (ED), financial development (FINDEV) and foreign direct investment (FDI) in Nigeria has received scant attention. The few existing studies have either focused on the determinants of ED but ignored the explicit role of FINDEV and FDI inflows or considered Nigeria as part of a crosscountry study, thereby ignoring its peculiarities. This paper therefore seeks to probe this linkage using the Toda Yamamoto causality test, the bounds testing approach to co-integration and error correction model to analyse data spanning 1970 to 2015. Findings indicate the existence of a causation running from FDI to ED but not the reverse as well as a causal link running from ED to FINDEV. This is similar to the results obtained when breaks were included as ED and FDI inflows were found to cause FINDEV. The long-run analysis revealed the existence of a stable co-integrating association between the variables and underscored the positive role of infrastructure development and FINDEV towards diversification. The parsimonious error correction models indicate 79 per cent (no break) and 75 per cent (break included) speed of adjustment to equilibrium in the event of a long-run disturbance to the system. Specifically, the contemporaneous coefficients of FINDEV, infrastructure and human capital development were found to exert a positive and statistically significant impact on ED. Our findings make a case for deepening the financial system, increasing human capital development efforts as well as creating incentives for infrastructure investments that can support the development of export-oriented sectors.

JEL classification: F10, F21, G00

Price: N500.00 | Add to cart




Forget password? | Signup for Free!
Note: You must signup your email and create a password before you can register as an NES member

Latest News

Policy Brief on The Nigerian Fuel Subsidy Puzzle: Facts, Fallacies and the Way Forward

Background The issue of the appropriate pricing of petroleum products in Nigeria, of which fuel more

2019 Election of New Council of the Nigerian Economic Society

The Executive Council of NES hereby informs its members that at the Business Session of 2019 Annual more

2019 Nigerian Economic Society Annual Public Lecture Announcement

The Executive Council of NES has the pleasure to announce it's 2019 Annual Public Lecture with the more

60th Annual Conference of the Nigerian Economic Society: Call for Abstracts

The Executive Council of NES has the pleasure to announce 60th Annual Conference with the theme " more

Winners of The Nigerian Economic Society PhD Thesis Prize Award in Economics for 2018

The Executive Council of the NES is pleased to announce the Winners of The Nigerian Economic more

Communique of the 59th Annual Conference of the Nigerian Economic Society, held at the NICON Luxury Hotel, Abuja from September 25-27, 2018

Theme: Optimizing Value Chain in the Agricultural Sector in Nigeria The Nigerian Economic Society more

E-Mail Subscription