ECONOMIC GLOBALIZATION AND MANUFACTURING OUTPUT IN NIGERIA

Abstract

The United Nations, in 2015 had emphasized through its Sustainable Development Goals 
(SDG), that adequate manufacturing output will reduce poverty, hunger and promote economic 
growth. However, Nigeria’s manufacturing output has failed to meet this target, with evidences 
of hunger, poverty and poor economic growth. This study examined the impact of economic 
globalization and the extent to which it contributed to variance on Nigeria’s manufacturing 
output. This study utilized manufacturing sector output and economic globalization index data 
from KOF globalization index. The auto regressive distributed lag was used for estimation of 
variables in this study. The findings of the study revealed that economic globalization index 
had long run relationship with manufacturing output. Economic globalization had positive and 
insignificant coefficient value in the short-run but turned negative and insignificant in the long
run. In addition to these results, the variance decomposition test revealed that globalization 
accounted for less than 20% variations in manufacturing output for the first five periods. The 
study concludes that economic globalization was not strong enough to drive manufacturing 
output in Nigeria and recommends that Nigeria should introduce import substitution strategy 
to enable her improve the contribution of globalization to her manufacturing output.