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How important is oil revenue in Nigerian growth process? Evidence from a threshold regression

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  • James Temitope Dada
  • Ezekiel Olamide Abanikanda

Abstract

This study examines the effect of oil revenue on Nigerian growth process by focusing on threshold level of oil revenue from 1980-2017. Growth rate of oil revenue and gross domestic product are used as proxy for oil revenue and economic growth index respectively. Data are sourced from Central Bank of Nigeria statistical bulletin and World Development Indicators, 2017 edition. Threshold regression is used as the estimation technique. The threshold level of oil revenue in Nigeria that sustain economic growth is 6.17%. Below the threshold level, oil revenue has positive and significant effect on economic growth. While in the second regime (above the threshold level), oil revenue has negative and significant effect on economic growth in Nigeria which affirms the resource curse hypothesis in Nigeria. The study concludes that proceeds from oil revenue should be effectively utilised and institutions should be strengthened.

Suggested Citation

  • James Temitope Dada & Ezekiel Olamide Abanikanda, 2019. "How important is oil revenue in Nigerian growth process? Evidence from a threshold regression," International Journal of Sustainable Economy, Inderscience Enterprises Ltd, vol. 11(4), pages 364-377.
    • Handle: RePEc:ids:ijsuse:v:11:y:2019:i:4:p:364-377
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    Cited by:

    1. Taiwo Akinlo & James Temitope Dada, 2022. "Information technology, real sector and economic growth in sub-Saharan Africa: a cross-sectional dependence approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(6), pages 4241-4267, December.
    2. James Temitope Dada & Ezekiel Olamide Abanikanda, 2022. "The moderating effect of institutions in foreign direct investment led growth hypothesis in Nigeria," Economic Change and Restructuring, Springer, vol. 55(2), pages 903-929, May.
    3. James Temitope Dada & Adams Adeiza & Noor Azizi Ismail & Arnaut Marina, 2022. "Investigating the link between economic growth, financial development, urbanization, natural resources, human capital, trade openness and ecological footprint: evidence from Nigeria," Journal of Bioeconomics, Springer, vol. 24(2), pages 153-179, July.
    4. James Temitope Dada & Taiwo Akinlo, 2021. "Foreign direct investment and poverty reduction in sub-Saharan Africa: does environmental degradation matter?," Future Business Journal, Springer, vol. 7(1), pages 1-10, December.

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