Oil and Non-Oil Foreign Direct Investment and Economic Growth in Nigeria: An Empirical Evidence from Autoregressive Distributed Lag Model

Hussain, Mustapha and Ahmed Mohammed, Abdullahi (2017): Oil and Non-Oil Foreign Direct Investment and Economic Growth in Nigeria: An Empirical Evidence from Autoregressive Distributed Lag Model. Published in: American Journal of Economics , Vol. 7(4), No. 2017, 7(4): 194-200 (10 August 2017): pp. 194-200.

Abstract

Abstract The paper examines the impact of both oil and non-oil foreign direct investment (FDI) on economic growth in Nigeria for the period 1980. The paper employed ARDL Approach to Cointegration and conditional EC Model in order to ascertain the long run and short-run relationships between the two categories of FDI (oil and non-oil), investment, export and economic growth. Bound cointegration test established that there is long run equilibrium relationship among the variables. Evidence from short run and long run elasticities shows that while non-oil FDI has positive effect on the growth of GDP, oil FDI exerts a negative effect on the economy and this may be due to the high profit repatriation and low level of domestic employment in the subsector. The result further shows that domestic investment has significant positive effect on economic growth, the coefficient of export is also positive although insignificant. In this study, we show that economic growth in Nigeria is largely propel by increasing inflows of FDI in the non-oil sectors, real export of goods and services and increased domestic investment.

• Item Type: MPRA Paper
• Language: English
• Keywords: Keywords FDI, Oil and non-oil FDI, Economic growth, ARDL
• Subjects: F - International Economics > F2 - International Factor Movements and International Business > F21 - International Investment ; Long-Term Capital Movements; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F42 - International Policy Coordination and Transmission; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F43 - Economic Growth of Open Economies

References

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