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Effects of oil export revenue on economic growth in Nigeria: A time varying analysis of resource curse

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  • Olayungbo, D.O.

Abstract

This paper examines the effects of oil revenue on economic growth by adopting the Bayesian time-varying parameter (TVP) model to further verify the resource curse hypothesis in Nigeria. The result provides new insights into the oil curse phenomenon in Nigeria. Therefore, using annual data from 1970 to 2015, oil revenue export is found to positively and significantly contribute to economic growth throughout the period of study. Empirically, Nigeria's economy is found to be a resource dependent economy. It is further found that unfavourable openness and low educational quality are possible transmission channels of slow growth experienced in Nigeria despite the receipt of huge oil revenue over the sample period. Channeling oil export revenue to more human capital development and tradable sectors are important for growth in the sample country. Finally, formulation, implementation and commitment to sound educational and trade policies are proposed recommendations for inclusive growth in Nigeria.

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  • Olayungbo, D.O., 2019. "Effects of oil export revenue on economic growth in Nigeria: A time varying analysis of resource curse," Resources Policy, Elsevier, vol. 64(C).
    • Handle: RePEc:eee:jrpoli:v:64:y:2019:i:c:s0301420717301344
    DOI: 10.1016/j.resourpol.2019.101469
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    14. Olatunji Abdul Shobande & Joseph Onuche Enemona, 2021. "A Multivariate VAR Model for Evaluating Sustainable Finance and Natural Resource Curse in West Africa: Evidence from Nigeria and Ghana," Sustainability, MDPI, vol. 13(5), pages 1-15, March.
    15. Young Ademola Obafemi, 2022. "Specialization Versus Diversification as Alternative Strategies for Sustainable Growth in Resource-Rich Developing Countries. Case of Nigeria," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 32(3), pages 1-47, September.
    16. Yao, Xilong & Wang, Hualing & Shao, Shuai & Li, Xiaoyu & Guo, Zhi, 2022. "“Booster” or “obstacle”: Can coal capacity cut policies moderate the resource curse effect? Evidence from Shanxi (China)," Resources Policy, Elsevier, vol. 75(C).
    17. Karunanithi Kriskkumar & Niaz Ahmad Mohd Naseem & Wan Ngah Wan Azman-Saini, 2022. "Investigating the Asymmetric Effect of Oil Price on the Economic Growth in Malaysia: Applying Augmented ARDL and Nonlinear ARDL Techniques," SAGE Open, , vol. 12(1), pages 21582440221, March.
    18. Erdoğan, Seyfettin & Yıldırım, Durmuş Çağrı & Gedikli, Ayfer, 2020. "Natural resource abundance, financial development and economic growth: An investigation on Next-11 countries," Resources Policy, Elsevier, vol. 65(C).
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    20. Adekoya, Oluwasegun B., 2021. "Revisiting oil consumption-economic growth nexus: Resource-curse and scarcity tales," Resources Policy, Elsevier, vol. 70(C).
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    22. Olatunji Abdul Shobande, 2022. "Does FDI Promote the Resource Curse in Nigeria?," JRFM, MDPI, vol. 15(9), pages 1-15, September.
    23. Edeh, Jude N. & Acedo, Francisco J., 2021. "External supports, innovation efforts and productivity: Estimation of a CDM model for small firms in developing countries," Technological Forecasting and Social Change, Elsevier, vol. 173(C).

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    More about this item

    Keywords

    Resource curse hypothesis; Oil revenue; Economic growth; Time-varying parameter; Bayesian estimation; Nigeria;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)
    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics

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