Trade liberalization and economic growth in Nigeria (1970-1996)

The main objective of this study is to examine the
role of trade liberalization on economic growth during the
period 1970 to 1996. Quite a number of empirical studies
over the years have demonstrated the importance of trade
on economic growth in developing countries. A quantitative
assessment of the relative impact of outward orientation on
economic growth would shed more light on the efficacy of
this strategy and contribute to the on going debate on
trade liberalization in Sub-Saharan African countries.
We employed the recently developed econometric
technique of Cointegration and Error Correction Modelling
(ECM) which most analysts have found to be very adequate
for handling economic data, particularly in LDCs to
estimate the main equation in our research work. To
confirm structural shift in our parameters, we divided the
period into two (before and after adjustment) and compared
the estimated parameters using Chow tests. Furthermore,
a thorough analysis of the effect of trade policies on
economic growth was investigated.