Importance of Trade Liberalization in Economic Growth Accounting

How the trade liberalization influences economic growth is a subject of interest that has attracted a large number of researchers. This work investigates the importance of trade openness in accounting for the dynamics of per capita real income in Nigeria during the period 1981-2015. This study makes use of the vector error correction model (VECM) as the method of estimation. The VECM is used in analyzing the short-run and long-run dynamics of economic variables namely gross domestic product per capita oil rent value-added of agriculture human capital gross capital formation and trade openness used as a proxy for trade liberalization.