The Impact of Globalisation on the Growth of Nigerian Economy from 1960-2010: Error Correction Model Analysis

Abstract

The paper empirically examined the impact of globalization on the growth of Nigerian economy using times-series data from 1960 to 2010. The paper utilized secondary data and various econometrics and/or statistical packages analytical (View 7.2) method were explored to examine the link between the econometrics variables and their impact on the growth of Nigerian economy. The paper tested the stationarity, cointegration of Nigerian’s time series data and used error correction mechanism to determine the long run and short run relationship among the variables examined. The results of the findings supported the Obadan’s findings which proved that growth of external debt ratio was an inversely related to economic growth in Nigeria. The paper recommended based on the econometric results that government should link the domestic investors with world markets to spur them into domestic production. Government should encourage grassroot production through Small and Medium Enterprises (SMEs), Government should spend more on infrastructural development. Government should encourage the import substitution initiative through the availability of short and long term credit facilities at a relative cheaper rate and strengthening both financial and capital markets in order to boost the confidence of potential investors on source of start-up capital.