Trade Openness and Inflation in Nigeria: A Nonlinear ARDL Analysis

This study investigated the relationship between trade openness and inflation in Nigeria between 1980 and 2015. It employed the nonlinear auto-regressive distributed lag (NARDL) modelling approach to co-integration based on the standard theoretical and empirical literature on trade openness-inflation relationship. Our approach allows us to simultaneously test the short- and long-run nonlinearities through positive and negative partial sum decompositions of the predetermined explanatory variables. Empirical evidence revealed that the direction of the relationship between openness and inflation is time specific. While there is a significant positive long-run relationship between inflation and trade openness, the analysis in contrast found a strong and robust negative link between openness and inflation in the short run. In addition, the obtained results indicate that trade openness affect inflation in an asymmetric and nonlinear manner. The results were found to be robust to different specifications. Key words: Inflation, Monetary Policy, Openness, NARDL, Nigeria. JEL Classification: E31, F41

Long Run Relationship between Education and Economic Growth in Nigeria: Evidence from Johansen Con-Integration Approach,

Abstracts This paper investigates the long run relationship between education and economic growth in Nigeria between 1970 and 2003 through the application of Johansen Cointegration technique and Vector Error Correction Methodology. It examines two different channels through which human capital can affect long run economic growth in Nigeria. The first channel is when human capital is a direct input in the production function and the second channel is when the human capital affects the technology parameter. The Johansen Cointegration result establishes a long run relationship between education and economic growth. A well educated labour force appears to significantly influence economic growth both as a factor in the production function and through total factor productivity

Oil Price Shocks and Their Effects on Mozambican Economy

In this paper, the oil price shocks and their effects on Mozambican economy is empirically analyzed for the time span covered by 1996:Q1-2012:Q4. The VAR methodology was used and the variables were Real Gross Domestic Product, Wages and Consumer Price Index. The results of the estimations, show a depressive impact on gross domestic product, increase in general the price level and the impact of an oil shock on wages is small and positive, in contradiction to conventional theory. In general, the wages decreases by an average of 1.5 percentage points. The key policy response to the impact of high oil prices is the extent to which governments have passed on the price increases to consumers, or have moderated them with subsidies, tax reductions, or pressure on oil companies to hold down price. Keywords: Oil prices, Mozambique, Vector Auto Regression. DOI: 10.7176/JESD/11-4-11 Publication date: February 29th 202

Sino-Africa Investment Relations: The Good, The Bad and The Ugly

China’s investment activities in Africa have attracted significant interest in academic, policy and media circles in the last one decade. Adopting country case studies analysis, findings indicated that Chinese investment relations with Africa have its good, bad and ugly sides. On the good side, China has established special economic zones which have the potential to build economic linkages with the local economy. However, the linkages are mainly forward, involving logistics, forwarding, and insurance and financial services. Backward linkages are fostered to the extent that the Chinese firms contract out transportation and catering services for their employees and sub-contract with local firms. The bad side includes the limited employment quota for local citizens, poor labour standard, limited technology transfer, and the quality of Chinese construction. The ugly side includes tax evasion and support to dictatorial regimes in Africa. Chinese companies should be well controlled and the legislation that guides their business conduct should be fully enforced

Trade Policy Reform, Regional Integration and Export Performance in the ECOWAS Sub-Region

This study examined the impact of trade policy reform and regional integration on export performance in the ECOWAS sub-region adopting the gravity model. Based on results from a gravity model analysis, the result revealed that participation in preferential trade agreements within the ECOWAS sub-region is beneficial and trade-facilitating. In addition, the existence of artificial barriers to trade among ECOWAS countries negatively affects export performance. The study therefore concluded that unilateral trade barrier reductions and participation in preferential trade agreements can enhance export performance within the ECOWAS sub-region

An analysis of China-Nigeria investment relations

Purpose – The purpose of this paper is to analyze the economic relation between China and Nigeria in the area of foreign direct investment (FDI). Design/methodology/approach – The study employed the use of quantitative (descriptive analysis such as ratios, percentages and correlation as well as cross tabulations), qualitative (key informant interviews and surveys) and case studies – for example the railway transport project handled by the Chinese. The use of surveys assisted the study to generate firm-level data that allowed the analysis of China-Nigeria investment relations with respect to concerns such as the employment effects as well as the competitive and/or complementary effects of Chinese firms to local firms. The use of content analysis of relevant documents and reports obtained from various sources was equally involved to corroborate the results obtained from primary data. Findings – The findings reveal that the major characteristic of Chinese investment in Nigeria is its concentration in a few sectors that are of strategic interest to China, especially in the extractive industries which are carried out largely by state-owned enterprises or joint ventures. In addition, the analysis clearly shows that the engagement with China, just like any bilateral relationship, has some advantages and disadvantages and that optimal outcome of the engagement will depend on the policies and institutions that are put in place to maximize the complementary effects and to minimize the competing effects. However, there is need to ensure implementation of laws and regulations in Nigeria and to ensure compliance by the Chinese investors. Originality/value – This is the first study to carry out an empirical analysis of the China-Nigeria relation. The study was able to establish the sectors where the incoming FDI from China is directed and the extent at which Chinese FDI is bundled with inflows of aid. The study was also able to show that the incoming Chinese FDI are in resource seeking, and the output targeted at the external market. The study will be of value to academia and to policy makers who are interested in studying the China-Africa relation.China, Crude oil, Economic sectors, Extractive industries, FDI, Foreign direct investment, Infrastructure, International investments, Nigeria