ISSN – PRINT:2756-4495 | ONLINE: 2756-4487
Volume 03, Issue 02 – 2023
Oshilike Ijeoma Victoria
This study explores the dynamic relationship of trade openness, international trade, exchange rate and inflation with economic growth for Nigeria over the period of 1981 to 2021 within a multivariate framework. The stationarity test, Johansen test for co-integration, OLS regression method, post estimation tests and test for causality were all employed in the study. The results reveal the existence of a positive relationship between international trade and economic development particularly import and export. Similarly, trade openness and economic growth depicted a significant positive relationship. Furthermore, as expected; a negative relationship existed between economic growth and exchange rate, and as well as inflation rate. Nevertheless, this was expected especially for a country that engages in international trade. The causality test results indicate unidirectional causality between exchange rate, trade openness, import and export, which runs from exchange rate to the other variables. The significances of the finding of this study is discussed along with its recommended course of actions.
Keywords: Trade Openness; Exchange Rate; Economic Growth; Inflation Rate; Import; Export