IDEAS home Printed from https://ideas.repec.org/a/bcp/journl/v4y2020i8p671-675.html
   My bibliography  Save this article

Causality between Manufacturing Efficiency, Energy Use and Economic Growth in Nigeria

Author

Listed:
  • Olabode Eric Olabisi (Ph.D)

    (Department of Economics, Faculty of Humanities, Social & Management Sciences, Elizade University, Ilara-Mokin, Ondo State, Nigeria)

Abstract

Studies on whether manufacturing productivity with interaction of energy use promotes economic growth are of cardinal importance as a result of the fact that energy use measured in kilogramme of oil equivalent per capita is a major factor that engineers the growth of manufacturing productivity. Using the unrestricted Vector Auto-regression (VAR) approach, the study examines the causality between manufacturing productivity, energy use and economic growth in Nigeria from 1985 to 2018. The Augmented Dickey Fuller unit-root tests, Pairwise and Wald test statistics Granger causality tests were employed. Results reveal two-way causality between manufacturing productivity and economic growth in Nigeria. While economic growth and manufacturing productivity (MP) Granger cause energy use (EU) and not vice versa, jointly examined, MP and EU promote growth in Nigeria, GDP and EU promote MP, and GDP combined with MP enhances the use of energy in Nigeria. It is therefore recommended that adequate energy supply should be made available to the manufacturing sector for meaningful economic growth to occur in Nigeria.

Suggested Citation

  • Olabode Eric Olabisi (Ph.D), 2020. "Causality between Manufacturing Efficiency, Energy Use and Economic Growth in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(8), pages 671-675, August.
    • Handle: RePEc:bcp:journl:v:4:y:2020:i:8:p:671-675
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijriss/Digital-Library/volume-4-issue-8/671-675.pdf
    Download Restriction: no
    File URL: https://www.rsisinternational.org/virtual-library/papers/causality-between-manufacturing-efficiency-energy-use-and-economic-growth-in-nigeria/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Chakravarty, Sangeeta & Mitra, Arup, 2009. "Is industry still the engine of growth? An econometric study of the organized sector employment in India," Journal of Policy Modeling, Elsevier, vol. 31(1), pages 22-35.
    2. Dan Su & Yang Yao, 2017. "Manufacturing as the key engine of economic growth for middle-income economies," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 22(1), pages 47-70, January.
    3. Robert Rowthorn & Ken Coutts, 2004. "De-industrialisation and the balance of payments in advanced economies," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 28(5), pages 767-790, September.
    4. Schwert, G William, 2002. "Tests for Unit Roots: A Monte Carlo Investigation," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 5-17, January.
    5. S. Necmi, 1999. "Kaldor's growth analysis revisited," Applied Economics, Taylor & Francis Journals, vol. 31(5), pages 653-660.
    6. Harris, R. I. D., 1992. "Testing for unit roots using the augmented Dickey-Fuller test : Some issues relating to the size, power and the lag structure of the test," Economics Letters, Elsevier, vol. 38(4), pages 381-386, April.
    7. Sukti Dasgupta & Ajit Singh, 2006. "Manufacturing, Services and Premature Deindustrialization in Developing Countries: A Kaldorian Analysis," WIDER Working Paper Series RP2006-49, World Institute for Development Economic Research (UNU-WIDER).
    8. Marconi, Nelson & Reis, Cristina Fróes de Borja & Araújo, Eliane Cristina de, 2016. "Manufacturing and economic development: The actuality of Kaldor's first and second laws," Structural Change and Economic Dynamics, Elsevier, vol. 37(C), pages 75-89.
    9. Vinish Kathuria & Rajesh Raj Natarajan, 2013. "Is Manufacturing an Engine of Growth in India in the Post-Nineties?," Journal of South Asian Development, , vol. 8(3), pages 385-408, December.
    10. W. McCausland & Ioannis Theodossiou, 2012. "Is manufacturing still the engine of growth?," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 35(1), pages 79-92.
    11. Jan Fagerberg & Bart Verspagen, 1999. "‘Modern Capitalism’ in the 1970s and 1980s," Palgrave Macmillan Books, in: Mark Setterfield (ed.), Growth, Employment and Inflation, chapter 9, pages 113-126, Palgrave Macmillan.
    12. Drakopoulos, Stavros & Theodossiou, Ioannis, 1991. "Kaldorian Approach to Greek Economic Growth," MPRA Paper 48989, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Haraguchi, Nobuya & Cheng, Charles Fang Chin & Smeets, Eveline, 2017. "The Importance of Manufacturing in Economic Development: Has This Changed?," World Development, Elsevier, vol. 93(C), pages 293-315.
    2. Bokosi, Fanwell Kenala, 2022. "The Effects of Industrialisation on Economic Growth: Panel data evidence for SADC countries," African Journal of Economic Review, African Journal of Economic Review, vol. 10(3), June.
    3. Lavopa, Alejandro & Szirmai, Adam, 2012. "Industrialization, employment and poverty," MERIT Working Papers 2012-081, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    4. Djidonou, Gbenoukpo Robert & Foster-McGregor, Neil, 2022. "Stagnant manufacturing growth in India: The role of the informal economy," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 528-543.
    5. Szirmai, Adam & Verspagen, Bart, 2015. "Manufacturing and economic growth in developing countries, 1950–2005," Structural Change and Economic Dynamics, Elsevier, vol. 34(C), pages 46-59.
    6. Charles Shaaba Saba & Nicholas Ngepah, 2022. "ICT Diffusion, Industrialisation and Economic Growth Nexus: an International Cross-country Analysis," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 2030-2069, September.
    7. Fiona Tregenna, 2011. "Manufacturing Productivity, Deindustrialization, and Reindustrialization," WIDER Working Paper Series wp-2011-057, World Institute for Development Economic Research (UNU-WIDER).
    8. Nelson Marconi & Igor L. Rocha & Guilherme R. Magacho, 2016. "Sectoral capabilities and productive structure: An input-output analysis of the key sectors of the Brazilian economy," Brazilian Journal of Political Economy, Center of Political Economy, vol. 36(3), pages 470-492.
    9. Alessandro Nuvolari & Emanuele Russo, 2019. "Technical progress and structural change: a long-term view," LEM Papers Series 2019/17, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    10. Yifei Li & Yuhang Bai, 2023. "Research on the Impact of Global Economic Policy Uncertainty on Manufacturing: Evidence from China, the United States, and the European Union," Sustainability, MDPI, vol. 15(14), pages 1-18, July.
    11. Umberto Monarca & Ernesto Cassetta & Michele Lo Re & Linda Meleo, 2019. "A Network Analysis of the Intersectoral Linkages Between Manufacturing and Other Industries in China and Italy," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 11(1-2), pages 80-97, January.
    12. Vinish Kathuria & Rajesh Raj Natarajan, 2022. "What Role Has Structural Change Played in Growth Accelerations for the Indian States? An Analysis for Pre- and Post-liberalization Periods," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 23(1), pages 61-85, March.
    13. Armando J. Garcia Pires & José Pedro Pontes, 2021. "(De)Industrialization, Technology and Transportation," Open Economies Review, Springer, vol. 32(3), pages 527-538, July.
    14. Tregenna, Fiona, 2011. "Manufacturing Productivity, Deindustrialization, and Reindustrialization," WIDER Working Paper Series 057, World Institute for Development Economic Research (UNU-WIDER).
    15. Itaman, Richard E. & Awopegba, Oluwafemi E., 2021. "Finance, oil rent and premature deindustrialisation in Nigeria," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 149-161.
    16. Eman Attiah, 2019. "The Role of Manufacturing and Service Sectors in Economic Growth: An Empirical Study of Developing Countries," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 112-127.
    17. Yazgan, Sekip & Marangoz, Cumali & Bulut, Emre, 2022. "The turning point of regional deindustrialization in the U.S.: Evidence from panel and time-series data," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 294-304.
    18. Yahya Z. ALSHEHHI & Judit OLÁH, 2017. "Sectorial Analysis: Growth Accounting Of Secondary Industries," Network Intelligence Studies, Romanian Foundation for Business Intelligence, Editorial Department, issue 9, pages 39-45, June.
    19. Hari S. Luitel & Gerry J. Mahar, 2016. "Algebra of Integrated Time Series: Evidence from Unit Root Analysis," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 22(2), pages 199-209, May.
    20. Gabriel, Luciano Ferreira & de Santana Ribeiro, Luiz Carlos, 2019. "Economic growth and manufacturing: An analysis using Panel VAR and intersectoral linkages," Structural Change and Economic Dynamics, Elsevier, vol. 49(C), pages 43-61.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcp:journl:v:4:y:2020:i:8:p:671-675. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Pawan Verma (email available below). General contact details of provider: https://www.rsisinternational.org/journals/ijriss/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.