Manufacturing Sector Output Research Articles

Forest succession, management and the economy under a changing climate: Coupling economic and forest management models to assess impacts and adaptation options

Climate change is expected to have significant impacts on forests by affecting the successional dynamics of tree species and the performance of plantations, among others. Research is needed to better understand how these factors will affect forests and economies in different regions, and how we can best adapt. To shed some light on these issues, we couple an economic (Computable General Equilibrium) model with a forest management (Woodstock) model to analyze the potential climate change impacts and adaptation options on timber supply and the economy over the 2015–95 period in a case-study province of New Brunswick, Canada. We estimate that climate change may have relatively large negative impacts on softwood timber supply (at 26% by 2095), softwood forestry & logging sector output quantity (at 12% by 2095), and softwood-dependent forestry manufacturing sector output (ranging from 6% to 27% by 2095). Negative impacts on GDP may be relatively smaller (at up to a 0.33% reduction by 2095). Adapting to these climate-related changes by planting drought-resistant softwood seedlings or hardwood seedlings in place of failed softwood plantations can minimize these negative impacts, and in the latter case, positively impact hardwood timber supply and output. While the former adaptation option is supported using cost-benefit analysis, the latter is not – due to the large incremental costs of growing, planting, and tending hardwood seedlings. Methods developed in this study can be applied in other regions to help guide decision-making around forest management in the face of a changing climate.

External Sector and The Nigerian Manufacturing Sector Performance, 1981-2019

No country is an island. The globalization phenomenon is making all countries to be interdependent. The external sector environment has become critical for the success of every country and internal balance. Thus, it has become important to examine how much the externa sector environment impact on the performance of the domestic economy. The present study, therefore, examined the influence of Nigerian external sector environment on the performance of the Nigerian manufacturing sector between 1981 and 2019. The study adopted exp-post research design approach and the Autoregressive Distributed Lag (ARDL) model estimation techniques. The empirical model consists of the Nigerian manufacturing sector output index as the dependent variable and exchange rate, trade openness, and foreign direct investment as independent variables and external sector environment variables. Test of unit root results indicated that the variables have mix order of integration, while the co integration analysis results indicated that the variables in the model have stable long run relationship. Estimate of the ARDL model reveals that in the short run exchange rate variations have negative, but significant effect on manufacturing sector performance, while trade openness, and FDI have positive but insignificant influence on the manufacturing sector performance in the short run. In the long run, exchange rate level and FDI inflows have positive and significant effect on the manufacturing sector performance, while trade openness has negative and significant effect on the Nigerian manufacturing sector performance. The study therefore conclude that the Nigerian external sector Environment has significant influence on the performance of the Nigerian manufacturing sector.

Inward FDI and Manufacturing Sector Productivity: An Empirical Evidence from the Dynamic ARDL Approach.

The real sector for which the manufacturing sector is a part play key role in the quest for achieving economic growth of any country. A high output in the manufacturing sector will connote a high level of GDP all things been equal. However, the productivity of the manufacturing sector is directly dependent on the capital-labour ratio. Thus, this study seeks to examine the impact of foreign capital (FDI) and domestic labour force (population) on the manufacturing sector output in Nigeria. The choice of ARDL approach by this study is informed by the mixed order of integration from the unit root test. The finding indicates that FDI inflow significantly and positively determine the manufacturing output in Nigeria, while labour influence the manufacturing in a positive but insignificant way. Further result prove that the impact of labour force is elastic, indication that little change in the labour force will cause drastically change in the level of output in the manufacturing output. In general, the manufacturing sector is capital-driven rather labour-driven. A recommendation is made of the need for the improvement in education and training to increase the efficiency of labour. Secondly, since FDI capital demonstrate significant positive impact, the authority concern should device policy that will woo more it into the sector for higher productivity. Such policy include, tax holidays, stable exchange rate and lower interest rate to enable smooth flow of investment.

Deficit financing approaches and the Nigerian sector’s output

This study examined the effect of deficit financing on Sectorial Output in Nigeria from 1986–2020. The independent variable in the study is deficit financing measured by domestic debt, foreign debt, budget deficit, and Foreign exchange reserve while the dependent variable in the study is Sectorial Output measured by Manufacturing Sector and Services Sector Output. Accordingly, the two models support the ARDL Methodology since they reported mixed integration. The study found that domestic debt has a positive significant effect on Sectorial Output in Nigeria. More so, Foreign Debt has a negative insignificant effect on Manufacturing Sector Output. However, it has a significant effect on the Services Sector Output in Nigeria. Again, the study found that Budget Deficit exerted a positive significant effect on Manufacturing Sector Output. However, it exerted a negative insignificant effect on Services Sector Output. While Foreign Reserve exerted a negative insignificant effect on Manufacturing Sector Output, Foreign Reserve had mixed effects on Services Sector Output; such effect tends to be statistically significant only in the short run. Lastly, the both inflation rate and the interest rate have a mixed effect on Sectorial Output.

Exchange Rates Management and Disaggregated Manufacturing Sector Output in Nigeria (1986-2019)

This study investigated the effect of exchange rates management on manufacturing sector in Nigeria from 1986-2019. Secondary data used in the analysis were sourced from Central Bank of Nigeria Statistical Bulletin, (2020) and World Development Indicators, (2020). Stationarity and orders of integration of the variables were examined with both Augmented-Dicky-Fuller (ADF) and Philip-Perron (PP) unit root tests. Having disaggregated manufacturing sector output into oil and non-oil source, two different models emerged. The results of Autoregressive Distributed Lag (ARDL) Bound test for co-integration revealed that the variables under oil sector model were co-integrated, while there was no evidence of co-integration in non-oil model. ARDL technique of estimation results showed that, both in the short-run and long-run, real exchange rates negatively and significantly impacted on oil manufacturing sector, while real interest rates negatively and significantly influenced the sector in the short-run. In the non-oil model, it was found that, both in the short-term and long-term, while real exchange rates negatively and significantly impacted on the sector, inflation produced positive and significant effect. Authority in Nigeria should improve on trade competitiveness of Nigeria with other countries via empowering the domestic currency to improve on domestic manufacturing sector performance.

Simulating the macroeconomic impact of expansion in total government expenditure on the economy of Nigeria

AbstractThis study examines the impact of further expansion in government spending in Nigeria for the period of 1970–2016. Using a simulation analysis, the model divides the economy into five blocks which corresponds with five key sectors: government, price, supply, external, and monetary/financial sectors of the economy. The simulation scenario involves the average annual increase in total government expenditure, based on the projections of the Economic Recovery and Growth Plan (ERGP) of the Federal Government of Nigeria. The results reveal positive and negative shocks across the sectors. Specifically, the results indicate that the policy fuels the growth of non‐oil output/export and real gross domestic product, suggesting the sensitivity of output to government expenditure. It further reveals a generally positive reaction from the monetary/financial sector variables, worsens inflationary pressure and exchange rate volatility crisis, while the manufacturing sector output also witnesses a significant fall. This study concludes that fiscal expansion in the form of public expenditure would yield a positive impact on the various sectors of the Nigerian economy, and that it would particularly serve as a veritable tool for achieving the diversification drive of the government. Overall, the study confirms the relative efficacy of fiscal policy in Nigeria. The study recommends sustained increase in government expenditure vis‐a‐vis fiscal discipline via the institutionalised regulatory framework. The economy should also be consciously diversified from oil to a non‐oil‐based economy.

Determinants and Sustainability of Manufacturing Sector Performance in Nigeria: The Roles of Selected Macroeconomic Variables

Manufacturing sector is a vibrant sector that spurs growth in every other sector of the economy. Despite this, macroeconomic environment in the country has not made this desire materialized. Therefore, the study examined the determinants and sustainability of manufacturing sector performance in Nigeria from 1994-2019. The data used include manufacturing sector output, interest rate, real exchange rate, tax rate, money supply and trade openness. Also, Error Correction Model (ECM) and Pairwise Granger Causality(PGC) techniques were used for the formulated objective. The unit root test confirmed stationarity of interest rate at level; while other were integrated of order one (D = 1). The Johansen co-integration established a long-run relationships. The ECM corrected the disequilibrium at an annual rate of 77.5%. Also, real exchange rate, tax rate and trade openness had a direct and significant effect on manufacturing sector output. While, interest rate and money supply were non-significance. The PGC result revealed a bi-directional causality between real exchange rate and manufacturing sector and tax rate and manufacturing sector output. It was concluded that increase in consumption tax, real exchange rate and liberation of the economy were the determinants of manufacturing sector performance, while appreciation of nigeria’s currency (naira) and increase in tax rate with proportional improvement in infrastructural facilities are needed to sustain it. Therefore, recommended that the financial institutions especially the apex bank should eliminate different bench-mark of exchange rate policy by allowing the market force of demand and supply to depict the real value of naira.

Time-Series Analysis of Industrial Sector Performance and Economic Growth in Nigeria: A Disaggregated Approach

This study investigated the impact of industrial section performance on economic growth in Nigeria. Specifically, the study examined the impact of manufacturing sector output, mining and quarrying sector output, utility sector output and construction sector output on economic growth proxied by per capital real gross domestic product in Nigeria. Phillips-Perron unit root test, Johansen cointegration test and error correction mechanism (ECM) were applied on annual time-series data for the period 1981 to 2019. The findings indicated a long-run relationship between industrial sector performance and economic growth. The estimated long-run regression result showed that manufacturing, and mining and quarrying subsectors make significant contribution to economic growth while utility and construction subsectors have insignificant positive impact on economic growth in Nigeria. The short-run (ECM) regression result showed that the outputs of the manufacturing, mining and quarrying, construction and utility sectors all have insignificant positive impact on economic growth. Among other things, it is recommended that there should be a general improvement in the productive capacity of the industrial sector to enhance its contribution to economic growth.

Effect of Monetary Policy on Industrial Growth in Nigeria

Monetary policy is one of the regulatory measures of the government to checkmate the money supply in the economy in order to achieve the desired level of prices, employment, output, and boost the industrial sector growth. Industrialization has always constituted a major focus of development strategy and government policy. One of the engines of industrialization is enhancing manufacturing sector capacity; this study adopted manufacturing sector output to examine the effect of monetary policy on industrial growth in Nigeria between 1986 and 2019. Data for the study were collected from the CBN Statistical bulletin, 2019 edition. A multiple regression model was developed and the Ordinary Least Square (OLS) regression technique employed for data analysis. The results showed that Open Market Operation (OMO) measured by Treasury bill rate had positive and significant effect on the Nigerian Manufacturing Domestic Sector Gross Product; Cash Reserve Ratio (CRR) has a positive and significant effect on the Nigerian Manufacturing Sector Gross Domestic Product; and Monetary Policy Rate (MPR) has a negative and significant effect on the Nigerian Manufacturing Sector Gross Domestic Product. The study concludes that monetary policy is a veritable tool for enhancing industrial sector growth in Nigeria. It was recommended that the monetary authority should ensure a lower MPR that can drive up investment and thus boost growth of the industry.

An econometric analysis of electricity consumption and real sector performance in Nigeria

PurposeThe purpose of this paper is to examine the extent at which electricity consumption (EC) has contributed to real sector performance, to identify energy-dependent sectors of the economy for appropriate sector-specific policy interventions and to avoid energy conservation policies that may retard the growth of the real sector and economic growth in general.Design/methodology/approachThis paper used time series data, covering the period between 1981 and 2015. Various time series econometric analyses such as unit root test for stationarity and vector autoregressive and vector error correction models were used to establish the long-run and short-run co-integration relationship among the variables.FindingsThis study finds that EC displays a little and insignificant impact on manufacturing sector output, as well as agriculture and service outputs. The empirical result from causality test suggests a unidirectional causality running from agriculture to EC, as well as service sector to EC, whereas bidirectional causality runs between EC and manufacturing sector. This study therefore recommends adequate power supply to the manufacturing sector, while energy efficiency policy and regulatory reform should address agriculture and service sectors.Originality/valueFew studies have examined the impact of EC on disaggregated gross domestic product. This research gap has strong policy implications on Nigerian economy as the output of real sector plays vital role in driving the economy. Given the pressing needs for Nigeria to boost real sector output and be among the world’s 20 largest economies by 2030, it becomes imperative for this sector-specific research to be conducted to ensure that sectoral purpose-driven energy interventions are formulated to address power supply challenges in the real sector.

Impact of Bank Deposit on Manufacturing Sector Output: The Case of Nigeria

Manufacturing sector plays an important role in the development of modern economy all over the world, whether advance or developing country. In the light of this, this study investigated the impact of bank credit on manufacturing outputfor the period 1981-2019. The variables were tested for stationarity. Error correction mechanism was adopted for the estimation of the model. Based on the result of the study, it was observed that credit to the manufacturing output has direct relationship with manufacturing output and it is statistically significant. Total government expenditure has direct relationship with manufacturing output, but not statistically significant. The relationship between exchange rate and corruption on output of manufacturing were Binverse and were not statistically significant. The most important variable affecting output of manufacturing sector is credit to the manufacturing. Manufacturing output in Nigeria does not significantly respond to changes in interest rate and government expenditure. The study concluded that credit to the manufacturing output is significant to the growth of manufacturing sector output in Nigeria economy. The paper recommended a better and stronger credit facility to manufacturing sector, should be promoted and sustained; there should be strong and comprehensive legal framework that will continue to aid in monitoring the performance of credit of the commercial banks. The most important variable affecting manufacturing output is credit to the manufacturing sector; effort should be made towards encouraging more credit to the manufacturing sector in Nigeria.

Dynamics of Core Inflation, Energy Inflation, Food Inflation and Manufacturing Sector Output Growth in Kenya: Econometric Analysis of Causality and Effects

World over, the manufacturing sector plays an important role in spurring economic development by boosting employment opportunities for semi-skilled labour and building a nation’s competitiveness through exports. Globally, only a few nations have managed to realize their development status without manufacturing sector playing a leading role. Kenya has not managed to develop a robust manufacturing sector and its growth has been majorly ascribed to the agricultural and service sectors. It has therefore, experienced de industrialization as evidenced by the decline in GDP contribution by the manufacturing sector from a paltry 10% in 2018 to 9.7% in 2019. The de industrialization has been characterized by fluctuating inflation rates, a scenario that has elicited debate as to whether there exists any nexus between manufacturing sector output growth and inflation rate. A few empirical studies have been conducted on the same, however, the exact relationship is not well defined. Furthermore, inflation has been largely treated as an aggregate, a scenario that hampers policy formulation. A disaggregated approach to the analysis thus motivated this study. Time series data from the world bank was used and VECM estimated to assess long run dynamics after stationarity test by ADF and Cointegration test by Johannes’s approach. Short run causalities were assessed via Wald test. The study revealed long run relationship between manufacturing output growth and the variables (core inflation, energy inflation and food inflation). Short run causality running from each of the inflation types to manufacturing output growth also exists. Food inflation negatively and significantly influences manufacturing output growth while core inflation has significant positive effect on the same. To enhance manufacturing output growth in Kenya, food inflation should be reduced and stabilized. In the same vain, low and stable level of core inflation should be ensured over time. Keywords: Inflation, Manufacturing Sector, Dynamics, Econometrics, Causality, Kenya DOI: 10.7176/JESD/12-4-06 Publication date: February 28 th 2021

EFFECTS OF INTEREST RATES ON PERFORMANCE OF MANUFACTURING FIRMS IN NIGERIA

The study evaluates the effect of interest rates on the performance of manufacturing firms in Nigeria between 1981 to 2018. Despite all attempts in developing the manufacturing sector it is still not performing or growing as expected. Statistics have shown that the share of manufacturing in the aggregate GDP declined from 5.3% in 1981 to 4.1% in 1993, 3.4% in 2005, and 4.1% in 1993, 3.4% in 2005, and 2.1% in 2016. The objective of the study is to assess the relationship between interest rates and the performance of manufacturing firms in Nigeria for 38 years. Three indicators such as manufacturing sector output, manufacturing capacity utilization, and manufacturing value-added were employed as proxies of manufacturing firm’s performance. The data were analyzed using ordinary least square regression (OLS) on manufacturing output and autoregressive distributed lag (ARDL) on manufacturing capacity utilization and manufacturing value-added. A pre-diagnostic test such as the unit root test and cointegration test was carried out on the variables. The cointegration test showed a relationship between manufacturing sector output and interest rates and no cointegration of interest rates with manufacturing capacity utilization and value-added. The data analyzed indicated interest rates has no effect on manufacturing sector output, result also showed that interest rates have no significant effect on capacity utilization and interest rates have a significant impact on manufacturing value-added in Nigeria. It is recommended that interest rates be benchmarked to single digits by the authority; manufacturing firms should be encouraged to operate on a full capacity scale so as to absorb the high-interest rates. The authority will need to step up the responsibility to ensure funds are made available at lower interest rates to the manufacturing sector.

The Manufacturing Sector Impact of Monetary Policy Frameworks: Evidence from Nigeria

Monetary policy as macroeconomic tool is germane to maintain economic balances and stimulate sectoral growth. However, the channels through monetary policy influenced manufacturing sector has not been adequately explored in Nigeria. Therefore, this study was carried out to uncover the linkage between monetary policy channels and manufacturing sector output in Nigeria within the period of 1986 to 2018. The unit root result based on Augmented Dickey-Fuller and Phillips-Peron tests showed the data series are integration of level and first difference. Data were analyzed with Autoregressive Distributed Lag-Bound Co-integration dynamic technique. It was discovered from the study that, monetary policy channels determines manufacturing sector output in the long run. It was further established that, manufacturing sector output responded positively and significantly to momentary policy rate, broad money supply and inflation rate while cash reserve ratio and exchange rate had negative and insignificant relationship with manufacturing sector output in the long run coefficients with mixed effects in the short run coefficients. These results suggest that, monetary policy channels are powerful tool for influencing manufacturing sector output and promoting sectroal growth especially in the long run. Thus, it was suggested that the current monetary policy frameworks should be maintained and sustained, while cash reserve ratio of banks should be reviewed to support lending to the manufacturing sector. The growth of money supply should be adequately monitored and controlled in line with the structure of the economy. Finally, appropriate and stable macroeconomic policies should be initiated to ensure macroeconomic stability capable of supporting manufacturing sector activities.

Foreign Direct Investment and Manufacturing Sector in Sierra Leone: A Vector Auto-Regression Analysis Approach

This study assesses the short-term and long-term impact of Foreign Direct Investment (FDI) on the manufacturing sector output in Sierra Leone using time series from 1970 to 2018. In order to assess the impact of FDI together with some explanatory variables such as inflation, movement of exchange rates, external debt and exports; the Vector Auto Regression (VAR) method was applied. It first tests for unit root using both the Augmented Dickey-fuller (ADF) and the Philip Perron (PP) tests. The results from the granger causality test imply that the foreign direct investment (FDI) greatly influences the manufacturing output (MQ, which also implies that, an increase in FDI will result to increase in MQ. There is also significant relationship between MQ, inflation and exchange rate (ER). Additionally, there is no directional relationship between external debt (DET) and export (XPT) with MQ. This implies that MQ cannot granger cause DET and XPT individually but it can granger cause them all in totality. The study also employed the Johansen cointegration method in order to derive the long-run relationship of the variables. The results from the empirical findings identified that there is positive relationship between the FDI and the manufacturing sector, while inflation and export reported a negative relationship with FDI. The error correction model (ECM) was also used to test for the short run relationship of the variables and reported that exchange rate and FDI availability are the main determinants of manufacturing sector output in Sierra Leone. The study did not find external debt, export and inflation to be significant with the manufacturing sector output in the short run. The study concluded that it is important for the Sierra Leone government to take into account the paramount role of FDI and also improve the business environment by creating an investment destination that is safe and friendly. This required government to formulate policies that are bias free and create a business environment that can inspire investors greatly. This calls for government to strengthen the implementation of reforms which will improve the country’s gross domestic product (GDP), while embarking on severe infrastructural development and curbing inflation via strengthening monetary policy.

Dynamics of Core Inflation, Energy Inflation, Food Inflation and Manufacturing Sector Output Growth in Kenya: Econometric Analysis of Causality and Effects

World over, the manufacturing sector plays an important role in spurring economic development by boosting employment opportunities for semi-skilled labour and building a nation’s competitiveness through exports. Globally, only a few nations have managed to realize their development status without manufacturing sector playing a leading role. Kenya has not managed to develop a robust manufacturing sector and its growth has been majorly ascribed to the agricultural and service sectors. It has therefore, experienced de industrialization as evidenced by the decline in GDP contribution by the manufacturing sector from a paltry 10% in 2018 to 9.7% in 2019. The de industrialization has been characterized by fluctuating inflation rates, a scenario that has elicited debate as to whether there exists any nexus between manufacturing sector output growth and inflation rate. A few empirical studies have been conducted on the same, however, the exact relationship is not well defined. Furthermore, inflation has been largely treated as an aggregate, a scenario that hampers policy formulation. A disaggregated approach to the analysis thus motivated this study. Time series data from the world bank was used and VECM estimated to assess long run dynamics after stationarity test by ADF and Cointegration test by Johannes’s approach. Short run causalities were assessed via Wald test. The study revealed long run relationship between manufacturing output growth and the variables (core inflation, energy inflation and food inflation). Short run causality running from each of the inflation types to manufacturing output growth also exists. Food inflation negatively and significantly influences manufacturing output growth while core inflation has significant positive effect on the same. To enhance manufacturing output growth in Kenya, food inflation should be reduced and stabilized. In the same vain, low and stable level of core inflation should be ensured over time. Keywords: Inflation, Manufacturing Sector, Dynamics, Econometrics, Causality, Kenya DOI: 10.7176/JESD/12-2-05 Publication date: January 31 st 2021

Labour Force, National Savings and the Manufacturing Sector Productivity in Nigeria

The study evaluated the role of sectoral labour force and the national savings on the manufacturing sector output in Nigeria from 1985 to 2019, a period of 35years. Data was sourced from Central Bank Of Nigeria (CBN) statistical bulletin various issues up until 2017, National Bureau of Statistics (NBS), and World Development Index (WDI). Data were analyzed using Vector Error Correction Model (VECM). The VECM result revealed that national savings and labour force have long run positive effect on the manufacturing sector output, while exchange rate and inflation have long-run negative effect on the manufacturing sector output. It could be deduced from this study that national savings, labour force in the industrial sector, inflation and exchange rate are very critical factors that determine the growth and survival of the manufacturing sector. Hence, it was recommended that the government look critically to the manufacturing sector and revamp the sector by making credit facility to the sector, and increase the use of domestic raw materials.

Effects of Bank Credits on the Manufacturing Sector Output in Nigeria (1981-2018)

This study investigated the effects of bank credits on the manufacturing sector output in Nigeria from 1981-2018. The data for this study were sourced from Central Bank of Nigeria (CBN) statistical bulletin. The study adopted the Auto-Regressive Distributed Lag (ARDL) bound cointegration test approach and error correction. In the bound test following the ARDL, it investigated that the variables of interest put in the model are bound together in the long-run and error correction term displayed a negative and statistically significant. The negative value shows that there exists an modification speed from short-run disequilibrium towards the long-run balance. Given the error correction instrument outcome, the study revealed that bank credits exhibited a optimistic and significant relationship with the presentation of manufacturing sector in Nigeria. The study therefore recommends that policies geared towards deepening the financial sector and enhancing the healthy and soundness of banks should be vigorously pursued. Also the Central Bank of Nigeria should as a matter of urgency review downwards the lending interest rate in view of this COVID-19 pandemic threatening the whole world.

Private Domestic Investment and Manufacturing Sector Output in Nigeria

This study examined the impact of private domestic investment on manufacturing sector output in Nigeria from 1970 to 2017. The study specifically looked at the impact of private domestic investment on manufacturing sector’s output in a static and dynamic model. Six variables were employed in the study and were sourced from CBN statistical bulletin and World Development Indicators for the period covering from 1970 to 2017. The analysis of the variables undergoes three approaches, the pre-analysis of data, model estimation and the diagnostic analysis of the model. The first approach employed tables and graphs to explain the behaviour of the data, equally the univariate analysis of the data were examine with the Augmented Dickey-Fuller equations and the possibility of long-term relationship. The models were estimated with the ARDL estimator and model selected with the Akaike Information Criteria, and finally the models estimated were tested using the Jaque-Bera statistics, Ramsey RESET Test, Breusch-Godfrey and Harvey test for residual normality, specification bias, autocorrelation and heteroskedasticity respectively. The results from the analytical methods shows that there is over 82 percent increase in the output of Manufacturing sector in the late 1970s and early 1980s and over 98 percent increase the output of the manufacturing sector in the late within 2010 and 2015. Also, the study observed that the responses of output of the manufacturing sector to private domestic investment are positive and significant in the static and dynamic models. The study found that the impact of private domestic investment on manufacturing sector output were fairly elastic in the static model and fairly inelastic in the dynamic model. Finally, the study found that the model have a weak adjustment mechanism. The adjustment of disequilibrium between static and dynamic equilibrium is weak or just 24.9 percent. Since private domestic investment is significant and positively impacted on the performance of the manufacturing sector irrespective of the time zone, the study recommended for increase in the credit to private sector by the apex monetary authority.

Electricity Consumption and Manufacturing Sector Output in Nigeria: Evidence from ARDL Approach

Energy plays a crucial role to the prosperity of any nation. Energy demands and the continuous existence of the productive sectors of the economy in Nigeria is such that that must be given prompt attention for national progress and productivity to be achieved in these sectors. This paper tries to examine electricity consumption and manufacturing sector output in Nigeria from 1981 to 2019. By employing the Autoregressive Distributed Lagged Model (ARDL) estimation technique. The variables considered for the study include electricity supply, unit of labour and gross capital formation, government expenditure on power, inflation, as independent variables and Manufacturing sector output as dependent variable. Furthermore, the outcome of the ADF unit root test showed a mix order of integration among the variables employed. The study finds a stable long-run relationship amongst the variables ARDL Wald Test. Estimated results shows that electricity consumption has a positive relationship with manufacturing sector output in the short-run and a negative relationship in the long-run. However, there is a significant impact of electricity consumption and manufacturing sector output in Nigeria Based on the findings above, the study recommends that government and policy makers in Nigeria to present a working economic plan for the manufacturing sector which will increase energy generation to the country and mostly to the manufacturing sector as this will increase local contents and promote the activities of small and medium scale enterprise who depend on energy needs in carrying out their operations.