Do Natural Resource Abundance Spur Economic Growth in Nigeria?

Abstract

The present paper investigates the relationship between natural resource abundance and economic growth for Nigeria covering the period 1970 to 2016. Our methodology encompasses autoregressive distributed lag (ARDL) bound test to cointegrating approach augmented by Bayer and Hanck combined cointegration test. Empirical results confirm a long run relationship among the variables under examination. More importantly, findings indicate that natural resource exerts a negative and significant impact on economic growth in both long run and short run dynamic analysis. This validates the Sachs and Warner’s hypothesis that natural resource is a curse than a blessing in Nigeria. Hence, the study stresses the needs for diversifying the non-resource based sectors to support the economy.