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Analysis of Some Drivers of Cocoa Export in Nigeria in the Era of Trade Liberalization

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  • Verter, N.
  • Bečvářová, V.

Abstract

This contribution analysis some determinants of cocoa export in Nigeria in the era of free trade. Using Johansen cointegration and OLS regression methods, the cointegration results show there exists a long- run equilibrium relationship between cocoa exports and the explanatory variables such as quantity of cocoa production, domestic consumption and the world price in Nigeria. More so, the OLS results provide a positive relationship between cocoa export and world price, trade openness, REER, and quantity of world cocoa export (statistically significant at the 0.01 and 0.05 levels). However, the results show an inverse association between cocoa export and domestic cocoa consumption (statistically significant at 0.01 level). The findings indicate that Nigeria has a comparative advantage in cocoa export. The Nigerian government and partners should create an enabling environment and some incentives to stimulate cocoa producers and traders by subsidizing farm inputs, and providing affordable loans to them to ensure sustainable cocoa production and export in the country.

Suggested Citation

  • Verter, N. & Bečvářová, V., 2014. "Analysis of Some Drivers of Cocoa Export in Nigeria in the Era of Trade Liberalization," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 6(4), pages 1-11, December.
    • Handle: RePEc:ags:aolpei:196590
    DOI: 10.22004/ag.econ.196590
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    References listed on IDEAS

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    1. Abdulai, Awudu & Rieder, Peter, 1995. "The Impacts of Agricultural Price Policy on Cocoa Supply in Ghana: An Error Correction Estimation," Journal of African Economies, Centre for the Study of African Economies, vol. 4(3), pages 315-335, December.
    2. Ahking, Francis W., 2002. "Model mis-specification and Johansen's co-integration analysis: an application to the US money demand," Journal of Macroeconomics, Elsevier, vol. 24(1), pages 51-66, March.
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    2. Nahanga Verter, 2016. "The Heckscher-Ohlin Model and the Performance of Cocoa Products in Nigeria," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 64(6), pages 2161-2172.
    3. Anton Oleinik, 2018. "EOpen Economy or Protectionism: Ukraine’s Dilemma," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 14(3), pages 109-127.
    4. Rita Remeikiene & Ligita Gaspareniene & Artiom Volkov, 2018. "Evaluation of the Influence of the Export in Agricultural Products on the Baltic States Economic Growth," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 14(3), pages 83-94.

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