scholarly journals On Exports and Capital Formation in Nigeria

2021 ◽  
pp. 1-10
Author(s):  
Uzoma Chidoka Nnamaka ◽  
Chukwuma-Ogbonna Joyce
Keyword(s):  
Exchange Rate ◽  
Crude Oil ◽  
Unit Root Test ◽  
International Market ◽  
Capital Formation ◽  
Sustainable Growth ◽  
Least Square ◽  
Oil Export ◽  
The Government ◽  
The Impact

One remarkable importance of exports is that it enables countries generate the required foreign capital needed to drive sustainable growth and development. This is to say that export earnings are capable of increasing capital formation through real investment. This study therefore focused on the impact of exports to capital formation in Nigeria for a 40-year time period spanning from 1981 to 2020. Related works on the subject matter were reviewed. The unit root test showed that all the variables attained stationarity after first difference. The Johansen cointegration test result showed that there exists a stable long run relationship between gross fixed capital formation, oil export, non-oil export and exchange rate in the model. Using the ordinary least square (OLS) estimation technique in analyzing the data sourced, the results showed that oil export had a negative and insignificant impact on capital formation in Nigeria. Similarly, non-oil export and exchange rate exerted insignificant negative influences on capital formation in Nigeria for the period covered by the study. Based on the findings from the study, the following recommendations were made. First is that the proceeds from crude oil export should be used to acquire capital assets for investment which will in turn drive growth in the economy. Also the government through the central bank of Nigeria (CBN) and relevant agencies should pay more attention to the non-oil sector in terms of the implementation of favourable policies, grants and loans, tax incentives, research and development, etc. to improve the export of the sector, making it compete favourably in the international market. This is because crude oil is an exhaustible asset that is liable to depletion. Finally, efficient exchange rate policies should be implemented by government through the relevant authorities to protect the value of the naira while ensuring that the products are not too dare in the international market.

An Empirical Re-examination

2017 ◽  
Vol 9 (1) ◽  
pp. 36-48 ◽  
Author(s):  
Onyinye I. Anthony-Orji ◽  
Anthony Orji ◽  
Jonathan E. Ogbuabor ◽  
Emmanuel Nwosu
Keyword(s):  
Economic Growth ◽  
Public Expenditure ◽  
Positive Impact ◽  
Statistical Significance ◽  
Research Work ◽  
Private Investment ◽  
Capital Formation ◽  
Oil Export ◽  
The Government ◽  
The Impact

The current decline in global oil prices and the attendant economic distortions it has caused in many oil-dependent economies, such as Nigeria, have become a cause of concern to researchers and economic managers alike. This research work, therefore, investigates the impact of non-oil export (NOIL) on capital formation and economic growth in Nigeria. It adopts a classical linear macroeconomic model using aggregate data time series from 1980 to 2013. Empirical results from the estimated model show that NOIL has a positive impact on capital formation and economic growth in Nigeria, respectively. However, the level of statistical significance differs between capital formation and economic growth. The study, therefore, recommends that there is a need for diversification of the economy as this will go a long way in boosting the growth of the Nigerian economy. Furthermore, the government should create an enabling environment that will ensure the survival and functioning of the ailing industries in order to diversify the economy. Finally, the problem of infrastructural deficits (water supply, transport system, telecommunication and energy) should be tackled by massive public expenditure and private investment, as this will enhance productivity in the non-oil sectors.

scholarly journals Validation of J-Curve Hypothesis in the Nigerian Non Oil Sector

2015 ◽  
Vol 8 (1) ◽  
pp. 15
Author(s):  
Jude O. Obasanmi ◽  
Fidelis O. Nedozi
Keyword(s):  
Exchange Rate ◽  
Unit Root Test ◽  
Policy Makers ◽  
Distributed Lag ◽  
Distributed Lag Model ◽  
J Curve ◽  
Oil Export ◽  
Lag Model ◽  
Oil Sector ◽  
The Impact

J-Curve is a term used to describe the impact of currency devaluation on a country’s balance of trade. In carrying out the study, two objectives stated which are; the validation of the j-curve hypothesis in the short (SR) and long runs (LR). Also, the researcher used the OLS in addition to distributed lag model because exchange rate devaluation does not take effect immediately giving room for lag model effect. The study span from 1985-2014. The study adopted its model from Rose and Yellen (1989) and Rose (1990). The unit root test was used to determine the stationarity of the data. From the results, the OLS result showed delayed J-curve hypothesis. Under the distributed lag (DL), the result shows obedience to the J-curve hypothesis. It is concluded that, policy makers should implement the theory only when the aggregate exchange rate differential between export (non oil) and import (all) is continuously greater than one or equal to one in favour of export (non oil export). One of the recommendations of the study is that policy makers should know that in the current competitive globe, no importing economy will relax to see its economy be a dumping ground (import bias), so superior trade policies should be advocated and implemented. The sustenance of development is one of Nigeria’s challenges. The major policy implication of the study is that Nigeria should diversify the economy, deepen its non oil export and improve its infrastructural base.

scholarly journals Exchange rate and economic growth nexus: An impact analysis of the Nigerian economy

2020 ◽  
Vol 2 (4) ◽  
pp. 58-67
Author(s):  
Lawali Bello Zoramawa ◽  
Machief Paul Ezekiel ◽  
Aliyu Tukur Kiru
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Impact Analysis ◽  
Unit Root Test ◽  
Secondary Data ◽  
Economic Openness ◽  
Johansen Cointegration Test ◽  
The Government ◽  
Level Of Significance ◽  
The Impact

This study examines the impact of the exchange rate, as an important determinant of economic growth in Nigeria between 1980 and 2019. Secondary data was used and sourced from the Central Bank of Nigeria (CBN) Statistical Bulletin 2016. The econometric techniques used in the analysis were: Unit Root Test, Johansen Cointegration Test, and Error Correction Model (ECM). The result revealed that exchange has a positive and statistically significant impact on economic growth at a 5% level of significance. But the result further revealed that economic openness was found to have impacted negatively on economic growth. Based on these findings it was recommended that the government through its monetary authority such as (CBN) should redesign the existing monetary policies to maintain a stable exchange rate. Lastly, since the economic openness hurts economic growth, it is therefore suggested that the government should sustain its current efforts in diversifying the economy in the country and disregard the notion that openness generates economic growth in the country.

scholarly journals Covid-19 Pandemic and the Market Performance Analysis: Evidence From Indonesia

2020 ◽  
Vol 11 (6) ◽  
pp. 337
Author(s):  
Achmad Nurdany ◽  
Muhammad Ghafur Wibowo ◽  
Izra Berakon
Keyword(s):  
Exchange Rate ◽  
Unit Root ◽  
Time Series Data ◽  
Market Performance ◽  
Unit Root Test ◽  
Commodity Price ◽  
Series Data ◽  
Point Selection ◽  
The Government ◽  
The Impact

This paper empirically identified the impact of the Covid-19 pandemic on market performance in Indonesia. We use a cointegrating regression model of FM-OLS and D-OLS along with Cubic Spline missing data interpolation, summary unit root test, unit root test with Dickey-Fuller breakpoint selection, and Johansen cointegration test. Daily time series data of Covid-19 cumulative case, exchange rate, IDX composite, and gold commodity price were analyzed around 119 days after the first announced case in Indonesia. The finding from FM-OLS and D-OLS analysis showed that the Covid-19 pandemic has a positive and significant impact on exchange rate and gold commodity price. The Covid-19 pandemic impact is appeared to be negative and significant in explaining IDX composite price. It seems that during the Covid-19 pandemic, people prefer to do transactions in the commodity market than neither capital nor money market. The diagnostic of cointegrating regression showed that all variables are integrated of order one I (1), and the long-run cointegration among variables in each equation exists. From the unit root test with break point selection, this study revealed that Covid-19 pandemic has an extreme impact on Indonesian market performance only in the first month after the case was announced. The government responses to mitigate the spread of the Covid-19 pandemic and to minimize the possibly profound impact of market performance are appeared to be successful. Besides, it seems that people's fear is diminished, quite high in the first month, and began to shrink in the following month.

scholarly journals Macroeconomic Variables And Savings Mobilization In Nigeria

2015 ◽  
Vol 3 (1) ◽  
pp. 105-116
Author(s):  
Peter A Okere ◽  
Michaelo Ndugbu
Keyword(s):  
Exchange Rate ◽  
Rural Areas ◽  
Research Work ◽  
Unit Root Test ◽  
Secondary Data ◽  
Least Square ◽  
Domestic Saving ◽  
Macroeconomic Variables ◽  
Domestic Savings ◽  
The Impact

This research work analyzed the impact of macroeconomic variables on domestic savings mobilization in Nigeria (1993-2012).Secondary data was adopted and sourced from CBN statistical bulletin.Ordinary Least Square and cointegration were used to determine the effects of the selected macroeconomic variables on savings mobilization in Nigeria. The result of the overall statistic showed that there is a positive and significant impact between the selected macroeconomic variables and domestic savings mobilization in Nigeria. But specifically, financial deepening seemed to have a greater impact on savings mobilization in Nigeria. Inflation and exchange rate revealed an inverse relationship with domestic saving mobilization in Nigeria. Augmented Dicker Fuller (ADF) unit root test and cointegration proved that the variables are stationary and there exist a long-run relationship among the variables. The study therefore recommended among others that efforts should be geared towards continuous and well-articulated fiscal and monetary policies that will sustain this growth in the financial sector. Also, Government should ensure that adequate macroeconomic policies that will be put in place to attract foreign investors, encourage export and make Nigeria an export platform where export goods could be produced, this will help to strengthen Nigeria’s exchange rate and induce domestic savings. Finally, proper measures should be put into encourages banks to open branches in the rural areas in order to mop up deposits. The rural banking policies should be revisited modified and implemented in Nigeria.

Open Door System and Endogenous Growth in Indian Economy: An Empirical Analysis on the Role of Human Capital and R&D in Explaining Industrial Productivity

2021 ◽  
Vol 46 (1) ◽  
pp. 24-37
Author(s):  
Arjun K. ◽  
Sanjay Kumar ◽  
A. Sankaran ◽  
Mousumi Das
Keyword(s):  
Human Capital ◽  
Exchange Rate ◽  
Real Exchange Rate ◽  
Endogenous Growth ◽  
Value Added ◽  
Capital Formation ◽  
Knowledge Capital ◽  
Test Technique ◽  
Long Run ◽  
The Impact

The present study investigates the impact of human capital, knowledge capital which is a function of human capital, and real exchange rate scenario in explaining long-run industrial total factor productivity (TFP) from 1980 to 2015 on the theoretical basis of the open endogenous growth model. The variables employed in the contemporary study include manufacturing value added (MNVA) as industrial output measure, gross fixed capital formation (GFCF) as a measure of capital and labour input which is measured using employment data. Gross enrolment ratio (GER) is taken as a measure for human capital formation, expenditure on research and development (R&D) as a proxy for knowledge capital, and real exchange rate indicates global economic shocks. The study involves estimating TFP for Industrial Sector during the post-liberalization period by employing Cobb-Douglas production function. The ARDL bounds test technique for cointegration revealed long-run relation among the varying factors studied. The Toda-Yamamoto causality test concluded bi-directional causality running between, R&D expenditure and Industrial TFP which sends a strong signal to the policymakers for a well-framed long-term integrated approach for human & knowledge capital formation which will act as a strong impetus for manufacturing firms to come up in terms of augmenting production and productivity and expanding foreign market horizon. JEL Classification: D24, E2, J24

scholarly journals Do Erratic Rainfalls Hamper Grain Production? Analysis of Supply Response of Rice to Price and Non-Price Factors

Agronomy ◽  
2021 ◽  
Vol 11 (8) ◽  
pp. 1463
Author(s):  
Ghulam Mustafa ◽  
Azhar Abbas ◽  
Bader Alhafi Alotaibi ◽  
Fahd O. Aldosri
Keyword(s):  
Unit Root Test ◽  
Rice Production ◽  
Vector Error Correction ◽  
Supply Response ◽  
Target Time ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
The Impact

Increasing rice production has become one of the ultimate goals for South Asian countries. The yield and area under rice production are also facing threats due to the consequences of climate change such as erratic rainfall and seasonal variation. Thus, the main aim of this work was to find out the supply response of rice in Malaysia in relation to both price and non-price factors. To achieve this target, time series analysis was conducted on data from 1970 to 2014 using cointegration, unit root test, and the vector error correction model. The results showed that the planted area and rainfall have a significant effect on rice production; however, the magnitude of the impact of rainfall is less conspicuous for off-season (season 2) rice as compared to main-season rice (season 1). The speed of adjustment from short-run to long-run for season-1 rice production is almost two-and-a-half years (five production seasons), while for season-2 production, it is only about one-and-a-half year (three production seasons). Consequently, the study findings imply the supply of water to be enhanced through better water infrastructure for both seasons. Moreover, the area under season 2 is continuously declining to the point where the government has to make sure that farmers are able to cultivate the same area for rice production by providing uninterrupted supply of critical inputs, particularly water, seed and fertilizers.

Macroeconomic fundamentals and dynamics of the Indian rupee-dollar exchange rate

2015 ◽  
Vol 7 (4) ◽  
pp. 301-326 ◽  
Author(s):  
Chandan Sharma ◽  
Rajat Setia
Keyword(s):  
Exchange Rate ◽  
Structural Break ◽  
Cointegration Analysis ◽  
Least Square ◽  
Dollar Exchange Rate ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Indian Rupee ◽  
Macroeconomic Fundamentals ◽  
The Impact

Purpose – This paper aims to examine the relationship between Indian rupee-US dollar exchange rate and the macroeconomic fundamentals for the post-economic reform period. Design/methodology/approach – The authors have used an empirical model which includes a range of important macroeconomic variables based on the basic monetary theories of exchange rate determination. At the first stage of the analysis, they have tested structural break in the data. Subsequently, they have employed the fully modified ordinary least square, Wald’s coefficient restriction and impulse response functions (IRF) to estimate the monetary model in the long- and short-run horizons. Findings – Results of analyses indicate that the macroeconomic fundamentals determine exchange rate in a significant way, but their effect varies sizably across the periods. The IRF illustrate the importance of interest rate in controlling exchange rate volatility. Practical implications – The analysis of the behavior of inter-relationship among macroeconomic variables will help policymakers in a deep-rooted understanding of this complex and time-varying relationship. Originality/value – Most of the existing studies have tested the impact of a single or a few macroeconomic fundamentals on exchange rate. But in the present study, we have tested the impact of a range of important variables, i.e. money supply, real income or output, price level and trade balance. Further, considering the importance of structural breaks in data, they authors have employed standard tests of structural break and incorporated the issue in the cointegration analysis.

scholarly journals Government Expenditure and Economic Growth Nexus: Evidence from Nigeria

2016 ◽  
Vol 5 (4) ◽  
pp. 56
Author(s):  
Oyediran, Leye Sherifdeen ◽  
Sanni, Ibrahim ◽  
Adedoyin, Lukman ◽  
Oyewole Olabode Michael
Keyword(s):  
Economic Growth ◽  
Capital Expenditure ◽  
Government Expenditure ◽  
Least Square ◽  
National Bureau ◽  
Fiscal Discipline ◽  
Secondary Sources ◽  
Economic Development And Growth ◽  
The Government ◽  
The Impact

The need to better the lots of citizens through government expenditure has raised questions on the impact of government expenditure on the economic development and growth of nations. It is against this background that this paper examined the antecedent effect of government spending on the Nigerian economic growth. The general objective of the study is to ascertain the relationship between government expenditure and economic growth in Nigeria; specifically, the study examined: (i) the significance influence of government capital expenditure on economic growth in Nigeria and (ii) the significance influence of government recurrent expenditure on economic growth in Nigeria. The study employed ordinary least square (OLS) multiple regression analysis in estimating the specified model, with the Gross Domestic Product (GDP) as the dependent variable, while Capital Expenditure (CAPEXP) and Recurrent Expenditure (REXP) are the independent variables. Data between 1980 – 2013 were collected from secondary sources through the National Bureau of Statistics (NBS) and Central Bank of Nigeria (CBN). Results showed that in Nigeria, there exist a significant relationship between the government expenditure and economic growth. The study therefore recommends instilling fiscal discipline in government expenditures, and putting in place structural mechanisms to act as surveillance on capital spending so as to boost the nation’s human and social capital.

scholarly journals Impact of Exchange Rate Management on the Nigerian Economic Growth: Empirical Validation

2019 ◽  
Vol 1 (2) ◽  
pp. 28-35
Author(s):  
Friday Osaru Ovenseri Ogbomo ◽  
Precious Imuwahen Ajoonu
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Inflation Rate ◽  
Government Expenditure ◽  
Least Square ◽  
Ordinary Least Square ◽  
Exchange Rate Management ◽  
Long Run ◽  
Short Run ◽  
The Impact

This paper examined the impact of Exchange Rate Management on economic growth in Nigeria between 1980 and 2015. The study was set to gauge how the management of exchange rate in Nigeria has impacted the economy. The study employed the Ordinary Least Square (OLS) method in its analysis. Co-integration and Error Correction Techniques were used to establish the Short-run and Long-run relationships between economic growth and other relevant economic indicators. The result revealed that exchange rate management proxy by various exchange rates regimes in Nigeria was not germane to economic growth. Rather, government expenditure, inflation rate, money supply and foreign direct investment significantly impact on economic growth in Nigeria. It is against this backdrop that the Nigerian economy must diversify her export base to create room for more inflow of foreign exchange.  

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