Macroeconomic Analysis of Export Diversification in Nigeria | Zendy

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Macroeconomic Analysis of Export Diversification in Nigeria

Author(s) -

Martins Iyoboyi

Publication year - 2019

Publication title -

empirical economic review

Language(s) - English

Resource type - Journals

eISSN - 2522-2465

pISSN - 2415-0304

DOI - 10.29145/eer/21/020104

Subject(s) - diversification (marketing strategy) , cointegration , exchange rate , economics , foreign direct investment , monetary economics , revenue , private sector , foreign exchange , capital formation , international economics , business , macroeconomics , finance , market economy , financial capital , econometrics , economic growth , human capital , marketing

In this paper, the Theil index was utilized to study the impact of macroeconomic variables on diversification in Nigeria for the period 1981-2015, using the bounds test approach to cointegration on data generated from secondary sources. Cointegration was found to exist between the economic diversification indicators and associated variables. We also found that capital formation, real effective exchange rate, domestic credit to private sector and foreign direct investment promote diversification. Government efforts in Nigeria should be geared towards diversifying the economy using oil revenue, promote foreign direct investment in the non-oil sector, provide fixed capital, encourage the flow of credit to the private sector, and implement a cautious exchange rate regime.

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