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Article Title:
Export Diversification and Economic Growth in Nigeria: An Empirical Test of Relationship Using a Granger Casualty Test
by Olaleye, Samuel Olasode, Edun, Femi, and Taiwo, Shakirudeen Babatunde

Abstract:
This study used a thirty (30) years dataset of Oil, manufacturing and agricultural share of total exports of Nigeria as independent variables and per capita income as the dependent variable which is used to capture economic development and welfare, which is important at a time the government of Nigeria is focusing on diversifying the economy. Thus, this study is an inevitable tool for policy makers and sector actors to properly optimize the benefits in their attempts at expanding the export basket of the country. This paper also analyzes theories and several attempts by the government at export diversification, some still ongoing and others not effective due to the changing need of the economy. The result estimation shows that all the variables used in the study are stationary at first differenced and also the Johansen co-integration test confirm the existence of a long-run relationship between the variables. It is of high importance to note that the granger casualty test indicated that there is a uni-directional relationship between Per Capita income and all the variables except Agricultural share of export which exhibits a bi-directional causal effects. This confirm the need for the country to look into diversifying the economy with a view to deepen the impacts of other sector on socio-economic development of the people. The study actually confirmed the assertion of relationship between export diversification and economic growth in Nigeria, using the Granger Casualty test which is the first time this method is adopted in the study of the impact of export diversification of the economy of the country, which has added to the empirical evidence. __________________________________________________________________________________________ Keywords: Export Diversification and Economic Growth in Nigeria: An Empirical Test of Relationship Using a Granger Casualty Test Olaleye, Samuel Olasode, Edun, Femi, and Taiwo, Shakirudeen Babatunde Economics Department, Lagos State University, Ojo Corresponding Author: Olaleye, Samuel Olasode ________________________________________________________________________________________ Abstract This study used a thirty (30) years dataset of Oil, manufacturing and agricultural share of total exports of Nigeria as independent variables and per capita income as the dependent variable which is used to capture economic development and welfare, which is important at a time the government of Nigeria is focusing on diversifying the economy. Thus, this study is an inevitable tool for policy makers and sector actors to properly optimize the benefits in their attempts at expanding the export basket of the country. This paper also analyzes theories and several attempts by the government at export diversification, some still ongoing and others not effective due to the changing need of the economy. The result estimation shows that all the variables used in the study are stationary at first differenced and also the Johansen co-integration test confirm the existence of a long-run relationship between the variables. It is of high importance to note that the granger casualty test indicated that there is a uni-directional relationship between Per Capita income and all the variables except Agricultural share of export which exhibits a bi-directional causal effects. This confirm the need for the country to look into diversifying the economy with a view to deepen the impacts of other sector on socio-economic development of the people. The study actually confirmed the assertion of relationship between export diversification and economic growth in Nigeria, using the Granger Casualty test which is the first time this method is adopted in the study of the impact of export diversification of the economy of the country, which has added to the empirical evidence.

Keywords: export diversification, per capita income, oil export, agricultural export, manufacturing export.

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