INDUSTRIAL OUTPUT AND NIGERIAN TRADE POLICY: A DISAGGREGATED ANALYSIS
INDUSTRIAL OUTPUT AND NIGERIAN TRADE POLICY: A DISAGGREGATED ANALYSIS

Summary/Abstract: The study examined the symmetric and asymmetric nexus between trade policy and industrial production disaggregated into manufacturing, electricity, mining and quarrying production in Nigeria. The study adopted the ARDL and NARDL framework based on annual time series data over the period 1970-2018. The findings depict that trade policy dynamics have short run non-linear effects on industrial output and its subsectors; manufacturing, building and construction, mining and quarrying output except electricity output and these effects dovetailed into the long-run and thus the asymmetric effects of trade policies on industrial output were confirmed. The results from the short-run non-linear ARDL further revealed that trade restrictions stimulate the performance of the industrial sector and the manufacturing subsector, while this performance plummets under trade liberalization. These results were confirmed by the short-run linear ARDL, while the long-run linear ARDL results reported the contrary without altering the asymmetric status of the nexus. The study therefore recommends guided liberal trade policy like the Korea, Indonesia and Japan model where some forms of protections allowed for rapid transformation of the industry and its subsectors.

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