Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance

Edward Ogbonnia Eleje; Okechukwu Agha Eze; Ishiaku Irom Agabi

doi:doi:10.11648/j.ijefm.20200801.11

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Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance

Edward Ogbonnia Eleje, Okechukwu Agha Eze, Ishiaku Irom Agabi

Published in International Journal of Economics, Finance and Management Sciences (Volume 8, Issue 1)

Received: 6 December 2019 Accepted: 23 December 2019 Published: 4 January 2020

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Abstract

Openness to trade is one basic factor spotted as major determinant of whether a country is prone to sudden stops in capital inflow, product glut, or severe economic recession. To some researchers, trade openness raises vulnerability to sudden shocks and creates difficult economic scenario; to others, it makes adjustment to crises less painful and stimulates effective economic performance. It is on the premise of the foregoing arguments that this study sought to evaluate the effect of trade openness on primary commodity export trade. To achieve this, the study utilized disaggregated oil and nonoil primary commodity export data and Gross Domestic Product (GDP) from Nigeria for a period of 30 years (1989-2018). Data were first subjected to diagnostic tests aided by STATA econometric to check the presence of unit root, multicollinearity and autocorrelation. Cointegration analysis was performed using Johanson and Juselius maximum likelihood estimation. Diagnosed data were regressed to generate optimal multivariate estimators of the cointegrating parameters at 95% level of confidence. Trade openness was negative but not significant on nonoil export. It was however positive but not significant on oil export. The paper concludes that while trade openness could be permissible on oil export in Nigeria, it is a charade on nonoil export. The study therefore recommends among other things the adoption of partial openness policy in developing nations especially Nigeria such that will involve the employment of liberal trade in the oil export subsector and trade protection in the nonoil subsector respectively.

Published in	International Journal of Economics, Finance and Management Sciences (Volume 8, Issue 1)
DOI	10.11648/j.ijefm.20200801.11
Page(s)	1-8
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2020. Published by Science Publishing Group

Keywords

Export Growth, Liberal Trade, Primary Commodity, Openness, Trade Barrier

References

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APA Style

Edward Ogbonnia Eleje, Okechukwu Agha Eze, Ishiaku Irom Agabi. (2020). Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. International Journal of Economics, Finance and Management Sciences, 8(1), 1-8. https://doi.org/10.11648/j.ijefm.20200801.11

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ACS Style

Edward Ogbonnia Eleje; Okechukwu Agha Eze; Ishiaku Irom Agabi. Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. Int. J. Econ. Finance Manag. Sci. 2020, 8(1), 1-8. doi: 10.11648/j.ijefm.20200801.11

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AMA Style

Edward Ogbonnia Eleje, Okechukwu Agha Eze, Ishiaku Irom Agabi. Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. Int J Econ Finance Manag Sci. 2020;8(1):1-8. doi: 10.11648/j.ijefm.20200801.11

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@article{10.11648/j.ijefm.20200801.11,
  author = {Edward Ogbonnia Eleje and Okechukwu Agha Eze and Ishiaku Irom Agabi},
  title = {Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {8},
  number = {1},
  pages = {1-8},
  doi = {10.11648/j.ijefm.20200801.11},
  url = {https://doi.org/10.11648/j.ijefm.20200801.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20200801.11},
  abstract = {Openness to trade is one basic factor spotted as major determinant of whether a country is prone to sudden stops in capital inflow, product glut, or severe economic recession. To some researchers, trade openness raises vulnerability to sudden shocks and creates difficult economic scenario; to others, it makes adjustment to crises less painful and stimulates effective economic performance. It is on the premise of the foregoing arguments that this study sought to evaluate the effect of trade openness on primary commodity export trade. To achieve this, the study utilized disaggregated oil and nonoil primary commodity export data and Gross Domestic Product (GDP) from Nigeria for a period of 30 years (1989-2018). Data were first subjected to diagnostic tests aided by STATA econometric to check the presence of unit root, multicollinearity and autocorrelation. Cointegration analysis was performed using Johanson and Juselius maximum likelihood estimation. Diagnosed data were regressed to generate optimal multivariate estimators of the cointegrating parameters at 95% level of confidence. Trade openness was negative but not significant on nonoil export. It was however positive but not significant on oil export. The paper concludes that while trade openness could be permissible on oil export in Nigeria, it is a charade on nonoil export. The study therefore recommends among other things the adoption of partial openness policy in developing nations especially Nigeria such that will involve the employment of liberal trade in the oil export subsector and trade protection in the nonoil subsector respectively.},
 year = {2020}
}

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TY  - JOUR
T1  - Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance
AU  - Edward Ogbonnia Eleje
AU  - Okechukwu Agha Eze
AU  - Ishiaku Irom Agabi
Y1  - 2020/01/04
PY  - 2020
N1  - https://doi.org/10.11648/j.ijefm.20200801.11
DO  - 10.11648/j.ijefm.20200801.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 1
EP  - 8
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20200801.11
AB  - Openness to trade is one basic factor spotted as major determinant of whether a country is prone to sudden stops in capital inflow, product glut, or severe economic recession. To some researchers, trade openness raises vulnerability to sudden shocks and creates difficult economic scenario; to others, it makes adjustment to crises less painful and stimulates effective economic performance. It is on the premise of the foregoing arguments that this study sought to evaluate the effect of trade openness on primary commodity export trade. To achieve this, the study utilized disaggregated oil and nonoil primary commodity export data and Gross Domestic Product (GDP) from Nigeria for a period of 30 years (1989-2018). Data were first subjected to diagnostic tests aided by STATA econometric to check the presence of unit root, multicollinearity and autocorrelation. Cointegration analysis was performed using Johanson and Juselius maximum likelihood estimation. Diagnosed data were regressed to generate optimal multivariate estimators of the cointegrating parameters at 95% level of confidence. Trade openness was negative but not significant on nonoil export. It was however positive but not significant on oil export. The paper concludes that while trade openness could be permissible on oil export in Nigeria, it is a charade on nonoil export. The study therefore recommends among other things the adoption of partial openness policy in developing nations especially Nigeria such that will involve the employment of liberal trade in the oil export subsector and trade protection in the nonoil subsector respectively.
VL  - 8
IS  - 1
ER  -

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Author Information

Edward Ogbonnia Eleje

Department of Banking and Finance, Federal University, Wukari, Nigeria
Okechukwu Agha Eze

Liquidity Management Unit, Treasury Department Keystone Bank Limited, Lagos, Nigeria
Ishiaku Irom Agabi

Department of Banking and Finance, Federal University, Wukari, Nigeria

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APA Style

Edward Ogbonnia Eleje, Okechukwu Agha Eze, Ishiaku Irom Agabi. (2020). Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. International Journal of Economics, Finance and Management Sciences, 8(1), 1-8. https://doi.org/10.11648/j.ijefm.20200801.11

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ACS Style

Edward Ogbonnia Eleje; Okechukwu Agha Eze; Ishiaku Irom Agabi. Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. Int. J. Econ. Finance Manag. Sci. 2020, 8(1), 1-8. doi: 10.11648/j.ijefm.20200801.11

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AMA Style

Edward Ogbonnia Eleje, Okechukwu Agha Eze, Ishiaku Irom Agabi. Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance. Int J Econ Finance Manag Sci. 2020;8(1):1-8. doi: 10.11648/j.ijefm.20200801.11

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@article{10.11648/j.ijefm.20200801.11,
  author = {Edward Ogbonnia Eleje and Okechukwu Agha Eze and Ishiaku Irom Agabi},
  title = {Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {8},
  number = {1},
  pages = {1-8},
  doi = {10.11648/j.ijefm.20200801.11},
  url = {https://doi.org/10.11648/j.ijefm.20200801.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20200801.11},
  abstract = {Openness to trade is one basic factor spotted as major determinant of whether a country is prone to sudden stops in capital inflow, product glut, or severe economic recession. To some researchers, trade openness raises vulnerability to sudden shocks and creates difficult economic scenario; to others, it makes adjustment to crises less painful and stimulates effective economic performance. It is on the premise of the foregoing arguments that this study sought to evaluate the effect of trade openness on primary commodity export trade. To achieve this, the study utilized disaggregated oil and nonoil primary commodity export data and Gross Domestic Product (GDP) from Nigeria for a period of 30 years (1989-2018). Data were first subjected to diagnostic tests aided by STATA econometric to check the presence of unit root, multicollinearity and autocorrelation. Cointegration analysis was performed using Johanson and Juselius maximum likelihood estimation. Diagnosed data were regressed to generate optimal multivariate estimators of the cointegrating parameters at 95% level of confidence. Trade openness was negative but not significant on nonoil export. It was however positive but not significant on oil export. The paper concludes that while trade openness could be permissible on oil export in Nigeria, it is a charade on nonoil export. The study therefore recommends among other things the adoption of partial openness policy in developing nations especially Nigeria such that will involve the employment of liberal trade in the oil export subsector and trade protection in the nonoil subsector respectively.},
 year = {2020}
}

Copy | Download

TY  - JOUR
T1  - Trade Openness for Developing Nations: A Charade or Desideratum for Viable Commodity Export Performance
AU  - Edward Ogbonnia Eleje
AU  - Okechukwu Agha Eze
AU  - Ishiaku Irom Agabi
Y1  - 2020/01/04
PY  - 2020
N1  - https://doi.org/10.11648/j.ijefm.20200801.11
DO  - 10.11648/j.ijefm.20200801.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 1
EP  - 8
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20200801.11
AB  - Openness to trade is one basic factor spotted as major determinant of whether a country is prone to sudden stops in capital inflow, product glut, or severe economic recession. To some researchers, trade openness raises vulnerability to sudden shocks and creates difficult economic scenario; to others, it makes adjustment to crises less painful and stimulates effective economic performance. It is on the premise of the foregoing arguments that this study sought to evaluate the effect of trade openness on primary commodity export trade. To achieve this, the study utilized disaggregated oil and nonoil primary commodity export data and Gross Domestic Product (GDP) from Nigeria for a period of 30 years (1989-2018). Data were first subjected to diagnostic tests aided by STATA econometric to check the presence of unit root, multicollinearity and autocorrelation. Cointegration analysis was performed using Johanson and Juselius maximum likelihood estimation. Diagnosed data were regressed to generate optimal multivariate estimators of the cointegrating parameters at 95% level of confidence. Trade openness was negative but not significant on nonoil export. It was however positive but not significant on oil export. The paper concludes that while trade openness could be permissible on oil export in Nigeria, it is a charade on nonoil export. The study therefore recommends among other things the adoption of partial openness policy in developing nations especially Nigeria such that will involve the employment of liberal trade in the oil export subsector and trade protection in the nonoil subsector respectively.
VL  - 8
IS  - 1
ER  -

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