MANUFACTURING SECTOR AND ECONOMIC GROWTH IN NIGERIA
Abstract
The importance of the manufacturing sector in the economic growth and development of an economy makes its analysis in the Nigerian context inevitable; hence, this study seeks to assess the level of utilization of the installed capacity in Nigeria's manufacturing sector and its contribution to her economic growth within the period 1986–2016. Data on gross domestic product, manufacturing output of the economy, foreign direct investment, and trade openness were used. Also, the unit root test was conducted using the Augmented Dickey-Fuller unit root test to ascertain the stationarity states of the variables used. Results from econometric analysis revealed that the manufacturing sector has a positive effect on the economic growth of Nigeria, but its contribution to her economic growth is very poor. The study therefore recommends, in line with the findings, that infrastructural facilities such as constant power supply and credit facilities be provided to boost the performance of the manufacturing sector. Also, tax holidays and subsidies should be granted to infant industries in order to stimulate the growth of such companies and their level of production.
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