Is the Nigerian economy balance-of-payments constrained? Empirical evidence from multi-sectoral model with intermediate imports

Panshak Y., CİVCİR İ., Ozdeser H.

JOURNAL OF INTERNATIONAL TRADE & ECONOMIC DEVELOPMENT, cilt.30, sa.2, ss.295-318, 2021 (SSCI) identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 30 Sayı: 2
  • Basım Tarihi: 2021
  • Doi Numarası: 10.1080/09638199.2020.1851289
  • Dergi Adı: JOURNAL OF INTERNATIONAL TRADE & ECONOMIC DEVELOPMENT
  • Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus, Academic Search Premier, IBZ Online, International Bibliography of Social Sciences, ABI/INFORM, Business Source Elite, Business Source Premier, EconLit, Geobase
  • Sayfa Sayıları: ss.295-318
  • Anahtar Kelimeler: Nigerian economy, income elasticities, balance-of-payment constraint, intermediate imports, ARDL, error correction model, STRUCTURAL-CHANGE, TRADE LIBERALIZATION, GROWTH-MODEL, UNIT-ROOT, MEXICO
  • Ankara Üniversitesi Adresli: Evet

Özet

This paper seeks to determine Nigeria's long-run growth path using a multi-sectoral version of the balance of payment constrained growth model from 1981 to 2016. It particularly contends that the actual growth of an economy is highly connected to sectoral differences in elasticities of income of tradable goods produced in the economy. The autoregressive distributed lag model (ARDL) approach is employed to obtain the required elasticities for the determination of the equilibrium growth rate. In line with research expectations, the first outcome of the study reveals that while, machinery and equipment turned out with the highest income elasticity; animal, fats and vegetable products was the lowest. This suggests that transition from primary production to the production of products of hi-tech products is necessary for growth. Second, high reliance on intermediate imports with high income elasticity could harm growth in the long run.