Empirical Investigation between Import, Export, Globalization and Nigerian Economic Growth; An Application of Granger causality 1986-2019

Abstract

The liberalization of the world economy has proceeded in such a way that the growth prospects of developing countries are being undermined. To better understand the nexus between globalization and economic growth, this study investigates the impact of globalization on Nigerian economy covering the period of 33 years (1986-2018). Four macroeconomic variables were selected based on theoretical and empirical evidences. The study employed econometric techniques in order to capture the objectives for which the study is poised to achieve such as summary descriptive statistics, matrix correlations, unit root test and co-integration test and granger causality model. From the Granger causality test result, the study found the unidirectional (one-way) causal-link between globalization (proxied by FDI, import and export) and Nigerian economy (proxied by GDP). Therefore, the study recommends that, Nigerian government to provide enabling macro-economic policies to converge with development in her major trading partners` economies in particular and the global trend in general.