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The Growth Implication of Trade Liberalization in West Africa

Author

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  • Umoh, Okon J.
  • Onye, Kenneth U.

Abstract

This study empirically investigates the growth implication of trade liberalization in twelve West African (WA) countries using time series data for the period of 1970-2011. Relying on a Vector error correction model (VECM), our result indicates that trade orientation (trade policy variable) investment rate and exports shocks have significant positive impact on growth in 8 out of 12 WA economies. This suggests that it is possible to stimulate economic growth in some African countries through an outward-looking strategy of export expansion. We, thus, conclude that WA economies can vigorously pursue trade liberalization in order to enhance their growth performance. The caveat is that this would require a refocusing of domestic production capacity to commodity lines that overlap those of the trading partners, especially those of the OECD nations, so as to be able to garner the benefits derivable from liberal trade policy.

Suggested Citation

  • Umoh, Okon J. & Onye, Kenneth U., 2013. "The Growth Implication of Trade Liberalization in West Africa," MPRA Paper 88371, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:88371
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    References listed on IDEAS

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    Cited by:

    1. Kadijat Adeleke, Oluwayemisi & Abamba Osakede, Uche & Monisola Ajeigbe, Omowunmi, 2021. "Trade Liberalization And Infrastructure Development: Evidence From The Economic Community Of West African States," Ilorin Journal of Economic Policy, Department of Economics, University of Ilorin, vol. 8(3), pages 1-20, June.

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    More about this item

    Keywords

    Liberalization; Economic Growth; West Africa; VECM;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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