Annals of the University of Oradea: Economic Science (Dec 2019)
TRADE OPENNESS, FOREIGN DIRECT INVESTMENT AND LIFE EXPECTANCY IN NIGERIA
Abstract
The paper examines the effects of trade openness, particularly, import openness and FDI inflows on life expectancy in Nigeria using annual time series data spanning the period from 1981 to 2017. The methodology involves the ARDL approach to cointegration and error correction modeling. The empirical evidence indicates that while import openness adversely affects life expectancy in the country, the effect of FDI inflows is positive, but not significant. Further evidence are that increase in the level of per capita income and government recurrent expenditure in health enhance life expectancy, while inflation adversely affects it. In view of the empirical evidence, the paper recommends, as measures to enhance life expectancy in Nigeria, imposition of restrictions on some categories of imports especially consumer goods (while encouraging domestic production of same through investment-friendly policies, programmes and initiatives, to meet domestic demand for consumer goods), deliberate and conscious effort to enhance the level of per capita real income through encouragement of investment to boost employment, increases in general government expenditure and, expenditure in health in particular, and control of inflation by the monetary and fiscal authorities using appropriate policy instruments.
