| Summary, etc |
Nigeria's economy experienced broad-based and sustained growth of over 7.00% on average between 2000 and 2014. However, from 2015 till date, the nation’s growth has declined substantially, entering a recession in 2016 and 2020. For instance, her gross domestic Product (GDP) growth, which was 2.65% in 2015 fell to -1.62% in 2016 and later to -1.79% in 2020 before surging to 3.65% and 3.25% in 2021 and 2022, respectively. This study investigated the impact of trade openness and FDI on economic growth in Nigeria from 1990-2022. Based on the framework of endogenous growth theory, the study utilized the Autoregressive Distributed Lag (ARDL) Bounds test approach and the Fully Modified Ordinary Least Square (FMOLS) for estimation. The ARDL technique was adopted after the unit root test results showed the order of integration of I(0) and I(1). Moreover, the long-run cointegration test was conducted using bounds cointegration analysis. This method was adopted after a thorough assessment of the time series properties of the model's variables. Data used for analysis was retrieved from the World Bank's world development indicators and Penn World Table. The findings from the project indicated that trade openness and foreign direct investment had an indirect impact on economic growth in Nigeria. However, the impact was only significant for Trade Openness in the short run as was<br/>shown in objective one. In objective three the negative sign was maintained for both variables. Nevertheless, Trade openness was statistically significant in the long run and marginally significant in the short run. Whereas, foreign direct investment was marginally significant in both the short run and the long run. The implication of the findings revealed that trade openness has not been beneficial to the economy of Nigeria. Therefore, the government should take a second look at the trade policies.Keywords: Trade openness, foreign direct investment, economic growth, Nigeria |
