EVALUATING THE IMPACT OF INNOVATION ON BILATERAL TRADE IN NIGERIA
DOI:
https://doi.org/10.26668/businessreview/2024.v9i4.4426Keywords:
Innovation, Patent, Copyright, Bilateral Trade, Nigeria, Regional Trade AgreementAbstract
Purpose: the study examined the impact of innovation categorised into copyright, patents, and innovation index, on bilateral trade flows and trade costs on manufactured bilateral trade in Nigeria.
Theoretical Framework: challenges facing the international trade such as high import and export tariff, taxes, deflation and inflation, unemployment and in one way or the other affect the economic growth of Nigeria. There is need to investigate the impact of innovation on bilateral trade flows and trade costs on manufactured bilateral trade in Nigeria.
Methodology: the study adopted an ex post facto research design. Data were subjected to various diagnostic test ranging from descriptive statistics, unit root test, using Micro-soft excel and E-View 10 and econometric modelling. The researcher employed an econometric method of analysis which makes validation to become necessary. Because it outlines the summary statistics which will display the statistical summary and properties of the variable included in the model.
Findings: Some research found a positive but non-significant relationship between technological innovation and economic growth and others showed just a positive relationship. Digital advancement was also shown to exhibit a significant effect on economic growth in Nigeria.
Research, Practical & Social Implication: The most consensus recommendation, was an increase in budgetary allocation for the technological development.
Downloads
References
Abelianskya, A. L. & Hilbert, M. (2017) Digital technology and international trade: Is it the quantity of subscriptions or the quality of data speed that matters? Telecommunications Policy, 41(1), 35-48. https://doi.org/10.1016/j.telpol.2016.11.001
Acs, Z., Anselin, L. & Varga, A. (2002). Patents and innovation counts as measures of regional produc- tion of new knowledge. Research Policy, (31), 1069–1085.
Adeleye, N. & Eboagu, C. (2019). Evaluation of ICT development and economic growth in Africa. Netnomics, 20, 31–53. https://doi.org/10.1007/s11066-019-09131-6
Aghion, P., Bergeaud, A., Lequien, M., & Melitz, M. J. (2017). The Impact of Exports on Innovation: Theory and Evidence.
Anderson, J. E. & van Wincoop, E. (2003). Gravity with gravitas: a solution to the border puzzle. American Economic Review, (93), 170–192.
Anderson, J. E. (1979). A Theoretical Foundation for the Gravity Equation. American Economic Association, 69(1), 106–116. Retrieved from http://www.jstor.org/stable/1802501
Anderson, J. E., & Wincoop, E. Van. (2004). No Title. Journal Of Economic Literature, 42(3), 691–751.
Anderson, J. E. & Yoto, V. Y. (2011). Specialisation: Pro - and Anti-globalising, 1990-2002. NBER Working Paper Series.
Asongu, S. A. (2018). Conditional Determinants of Mobile Phones Penetration and Mobile Banking in Sub.Saharan Africa. Journal of the Knowledge Economy, 9(1), 81-135.
Azu, N. P. (2019). Trade realignment position in ECOWAS with gravity model. International Journal of Economic Policy in Emerging Economies, 12(2), 103–112. doi:10.1504/
IJEPEE.2019.099711
Azu, N. P. (2020). Assessing the Costs of Alliance Withdrawal on Trade Determination: A Lesson from Mauritania. Journal of African Business, DOI: 10.1080/15228916.2020.177
Azu, N. P. & Muhammad, M.Y. (2020). Does political regime influence bilateral trade in West Africa? Transnational Corporations Review, 12(3), 293-303, DOI: 10.1080/19186444.20
1757341
Azu, N. P., Okezie, B. N., & Hirwa, A. (2019). Gravity perspective of trade realignment: Assessing China's engagement in West Africa. Global Journal of Emerging Market Economies, 11(3), 165–182.
Azu, N. P. & Nwauko, P. A. (2021). Evaluating the effect of Digital Transformation on Improvement of Service Trade in West Africa. Foreign Trade Review, 56(4), 430-453 https://doi.org/10.1177/00157325211032021
Azu., N. P., Jelivov, G., Aras O. N. & Isik, A. (2020). Influence of Digital Economy on Youth Unemployment in West Africa. Transnational Corporations Review, 13(1), 32-42
Baier, S. L. & Bergstrand, J. H. (2007). Do free trade agreements actually increase members' international trade? Journal of International Economics, 71(1), 72-95. https://doi.org/
1016/j.jinteco.2006.02.005.
Baier, S. L. & Bergstrand, J. H. (2009). Bonus vetus OLS: a simple method for approximating international trade-cost effects using the gravity equation. Journal of International Economics, 77(1), 77–85.
Baldwin, R., & Harrigan, J. (2011). Zeros, quality, and space: Trade theory and trade evidence. American Economic Journal: Microeconomics, 3(2), 60–88.
Baldwin, R. & DiNino, V. (2002). Euros and Zeros: The Common Currency Effect on Trade in New Goods (No. 5973).
Baldwin, R. & Taglioni, D. (2006). Gravity for dummies and dummies for gravity equations.
Basberg, B. (1987). Patents and the measurement of technological change: a survey of the literature. Research Policy, (16), 131–141.
Bayoumi, T. & Eichengreen, B. (1995). Is Regionalism Simply a Diversion? Evidence from the Evolution of the EC and EFTA (No. 95/109).
Belderbos, R. & Sleuwaegen, L. (1998). Tariff Jumping FDI and Export Substitution: Japanese Electronics Firms in Europe. International Journal of Industrial Organization, 16(5), 601–638.
Bergstrand, J. H. (1985). The gravity equation in international trade: some microeconomic foundations and empirical evidence. The Review of Economics and Statistics, 67(3), 474–481. Retrieved from http://www.jstor.org/stable/1925976
Bojnec, S. & Fertö, I. (2009). Impact of the internet in Manufacturing trade. Journal of Computable Information System, 50(1), 124-132.
Burger, M., van Oort, F. & Linders, G. J. (2009). on the specification of the gravity model of trade: Zeros, excess zeros and zero-inflated estimation. Spatial Economic Analysis, 4(2), 167–190.
Carboni, O. A. & Medda, G. (2018). R&D, export and investment decision: evidence from European firms. Applied Economics, 50(2), 187-201, DOI: 10.1080/00036846.2017.
Carboni, O. A. & Medda, G. (2020). Linkages between R&D, innovation, investment and export performance: evidence from European manufacturing firms, Technology Analysis & Strategic Management, 32(12), 1379-1392. DOI: 10.1080/09537325.2020.1769841
Carrere, C. (2006). Revisiting the Effects of Regional Trade Agreements on Trade Flows With Proper Specification of the Gravity Model. European Economic Review, (50), 223–247.
Bravo-Ortega, C., Benavente, J. M. & González, Á. (2014). Innovation, Exports, and Productivity: Learning and Self-Selection in Chile. Emerging Markets Finance and Trade, 50(1), 68-95.
Comanor, W. S., & Scherer, F. M. (1969). Patent Statistics as a Measure of Technical Change. Journal of Political Economy, 77(3), 392–398.
Choi, C. (2010). The effect of the Internet on service trade. Economics Letters, 109(2), 102-104 https://doi.org/10.1016/j.econlet.2010.08.005
Dadakas, D., Kor, S. G. & Fargher, S. (2020). Examining the trade potential of the UAE using a gravity model and a Poisson pseudo maximum likelihood estimator. The Journal of International Trade & Economic Development, 0(0), 1–28. https://doi.org/10.1080/
2019.1710551
Davis, F. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly, 13(3), 319-340.
Deardorff, A. V. (1998). Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World? National Bureau of Economic Research, (January), 7–32. Retrieved from http://www.nber.org/chapters/c7818
Demir, F. & Hu, C. (2020). Destination institutions, firm heterogeneity and exporter dynamics: empirical evidence from China. Review of World Economics, 156, 183–217. https://doi.org/10.1007/s10290-019-00358-x
Disdier, A. C. & Head, K. (2008). The puzzling persistence of the distance effect on bilateral trade. The Review of Economics and Statistics, 90(1), 37-48. https://doi.org/10.1162/
rest.90.1.37
Efobi, U., Tanankem, B. & Asongu, S. (2018). Female Economic Participation with Information and Communication Technology Advancement: Evidence from Sub‐Saharan Africa. South African Journal of Economics, 86(2), 231-246.
Ejemeyovwi, J. O. & Osabuohien, E. S. (2018). Investigating the relevance of mobile technology adoption on inclusive growth in west Africa. Contemporary Social Science, 15(1), 48-61. https://doi.org/10.1080/21582041.2018.1503320.
Ekanayake, E. M., Mukherjee, A. & Veeramacheneni, B. (2010). Trade Blocks and the Gravity Model: A Study of Economic Integration among Asian Developing Countries. Journal of Economic Integration, 25(4), 627–643.
Engel, R. J., & Schutt, R. . (2009). The Practice of Research in Social Work (Second edi). Retrieved from www.elsevier.com /locate/technovation
Eve M.H chan, & k.F.Au. (2007). Determinants of China' s textile exports : An analysis by gravity model Determinants of China' s textile exports : An analysis by gravity model. Journal of The Textile Institute ISSN:, 98(5), 463–469. https://doi.org/10.1080/00405000701556095
Fadeyi, O. A., Bahta, T. Y., Ogundeji, A. A., & Willemse, B. J. (2014). Impacts of the SADC free trade agreement on South African agricultural trade. Outlook on Agriculture, 43(1), 53–59. https://doi.org/doi:10.5367/oa.2014.0154
Fally, T. (2015). Structural Gravity and Fixed Effects. Journal of International Economics, (97), 76–85.
Feenstra, R. . (2016). Advanced International Trade: Theory and Evidence. Princeton university press, Princeton, New Jersey, United States.
Feenstra, R. C. (2002). "Border Effects and the Gravity Equation: Consistent Methods for Estimation." Scottish J. Polit. Econ, 49(5), 491–506.
Freunda C.L. & Weinhold D. (2004). The effect of the Internet on international trade. Journal of International Economics, 62(1), 171-189 https://doi.org/10.1016/S0022-1996(03)00059-X
Gomez-Herrera, E. (2013). Comparing Alternative Methods to Estimate Gravity Models of Bilateral Trade. Empirical Economics, (44), 1087–1111.
Griliches, Z. (1979). "Issues in Assessing the Contribution of R&D to Productivity Growth. Bell Journal of Economics, (10), 92–116.
Griliches, Z. (1998). Patent Statistics as Economic Indicators: A Survey. 287–343. Retrieved from http://www.nber.org/chapters/c8351
Hallak, J. C. (2006). Product quality and the direction of trade. Journal of International Economics, 68(1), 238–265.
Havrylyshin, O.and Pritchett, L. (1991). . European Trade Patterns After the Transitions, PRE Working Paper Series.
Helpman, E., Melitz, M.& Rubinstein, Y. (2008). Estimating trade flows: Trading partners and trading volumes. The Quarterly Journal of Economics, 123(2), 441–487.
Helpman, E., & K. P. R. (1985). Market structure and foreign trade: Increasing return, imperfect competition, and international economy.
Hipp, C., & Grupp, H. (2005). Innovation in the service sector: The demand for service-specific innovation measurement concepts and typologies. Research Policy, (34), 517–535.
Hummels, D. L. (2001). "Toward a Geography of Trade Costs." Retrieved from Available at SSRN 160533
Hurd, M. (1979). Estimation in truncated samples when there is heteroscedasticity. Journal of Econometrics, 11(2), 247–258.
Julius, S., Azu, N. P. & Muhammad, M.Y. (2019). Assessing The Impact of Terrorism in Trade Development in the SADC Region: A Gravity Model Approach. Asian Economic and Financial Review, 9(10), 1147-1159. DOI: 10.18488/journal.aefr.2019.910.1147.1159
Kerlinger, F. . (1986). Foundations of Behavioral Research. 3rd Edition, Holt, Rinchart and Winston, Publishers, New York.
Kuznets, S. (1962). Inventive activity: Problems of definition and measurement (In Richard). Princeton: Princeton University Press.
Lateef, M., Tong, G., Riaz, M., Lateef, M., & Tong, G. (2019). Exploring the Gravity of Agricultural Trade in China – Pakistan Free Trade Agreement Exploring the Gravity of Agricultural Trade in China – Pakistan Free Trade Agreement. The Chinese Economy, 51(6), 522–533. https://doi.org/10.1080/10971475.2018.1481008
Lee, J.W., & Swagel, P. (1997). Trade barriers and trade flows across countries and industries. . . Review of Economics and Statistics, 79(3), 372–382.
Lin, F. (2014). Estimating the effect of the Internet on international trade, The Journal of International Trade & Economic Development: An International and Comparative Review, 24(3), 409-428. DOI: 10.1080/09638199.2014.881906
Manning, W. G. & Mullahy, J. (2001). Estimating log models: to transform or not to transform? Journal of Health Economics, 20(4), 461–494.
Martin, W. & Pham, C. (2008). Estimating the gravity model when zero trade flows are important.
Martinez-Zarzoso, I. (2011). The Log of Gravity Revisited. Applied Economics, 45(3), 311–327.
McCallum, J. (1995). National borders matter: Canada-US regional trade patterns. The American Economic Review, 85(3), 615–623.
Muhammad, S. D., Diyoke, K.O. & Azu, N. P. (2020). The Consequences of Foreign Direct Investments in Redefining Bilateral Trade Flow in Nigeria: A Gravity Panel Approach. Asian Economic and Financial Review, 10(4), 367-379. DOI: 10.18488/journal.aefr.2020.
367.379
Olivero, M. & Yotov, Y. (2012). Dynamic gravity: theory and empirical implications. Canadian Journal of Economics, 45(64–92).
Olivero, M. P. & Y. V. Y. (2012). Dynamic Gravity: Endogenous Country Size and Asset Accumu- lation. Canadian Journal of Economics, 45, 64–92.
Paci, R. & Usai, S. (1999). Externalities, knowledge spillovers and the spatial distribution of innovation. GeoJournal, (49), 381–390.
Poyhonen, P. (1963). A tentative model for the volume of trade between countries. Review of World Economics, 90(1), 93–100.
Raja, S., Imaizumi, S., Kelly, T., Narimatsu, J. & Paradi-Guilford C. (2013). Connectingtowork: How information and communication technologies could help expand employment opportunities. International Bank for Reconstruction and Development / The World Bank Washington DC.
Rauch, J. (1996). Trade and Search: Social Capital, Sogo Shosha, and Spillovers. NBER Working Paper, (5618). Cambridge: National Bureau of Economic Research.
Rauch, J. E. & Casella, A. (2003). Overcoming Informational Barriers to International Resource Allocation: Prices and Ties. The Economic Journal, 113(484), 21–42.
Rose, A. K. & Spiegel. M. M. (2011). The Olympic Effect. The Economic Journal, 121(553), 652-677.
Santos, S. J. & Tenreyro, S. (2006). The log of gravity. Review of Economics and Statistics, 88, 641-658. https://doi.org/10.1162/rest.88.4.641
Santos, S. J. & Tenreyro, S. (2011). Further simulation evidence on the performance of the poisson pseudo-maximum likelihood estimator. Economics Letters, 112, 220-222. https://doi.org/10.1016/j.econlet.2011.05.008
Sanyal, P. (2004). The role of innovation and opportunity in bilateral OECD trade performance. Review of World Economy, 140, 634–664. https://doi.org/10.1007/BF02659618
Shepherd, B. (2013). Gravity Model of International Trade: A User Guide. New Dehli: United Nations Economic and Social Commission for Asia Pacific.
Sovbetov Y. (2018). Impact of Digital Economy on Female Employment: Evidence from Turkey, International Economic Journal, 32(2), 256-270, DOI: 10.1080/10168737.
1478868
Sullivan, D. O. & Dooley, L. (2009). Applying Innovation. SAGE Publication.
Sulistijowati, R., Yuliati, L., Komariyah, S. & Musaiyaroh, A. (2023). Analysis of Trade, Investment, and Global Value Chain on the Gross Domestic Product of Fisheries Sector in Indonesia. International Journal of Professional Business Review (JPBReview), 8(6), 1–22. https://doi.org/10.26668/businessreview/2023.v8i6.2365
Tekin, E., & Hancıoğlu, Y. (2018). Nurettin Bilici / Birol Global Issues in Social Sciences Different Perspectives. Global Issues in Social Sciences, (May 2018). https://doi.org/DOI 10.3726/b13343
Tinbergen, J. (1962). Shaping the world economy. Suggestions for an international economic policy. The Twentieth Century Fund.
Trefler, D. (1993). Trade liberalisation and the theory of endogenous protection: an econometric study of US import policy. Journal of Political Economy, (101), 138–160.
Uibu, K. & Kikas, E. (2008). The roles of a primary school teacher in the information society. Scandinavian Journal of Educational Research, 52, 459-480.
Wakelin, K. (1998). The role of innovation in bilateral OECD trade performance. Applied Economics, 30(10), 1335-1346. DOI: 10.1080/000368498324959
Wei, S. (1996). Intra-national versus international trade: how stubborn are nations in global integration? (No. 5531).
Yadav, N. (2014). The Role of Internet use on international trade: evidence from Asian and Sub-Sahara African Enterprises. Global Economic Journal, 14(2). 189-214 https://doi.org/10.1515/gej-2013-0038
Yuliadi, I., Basuki, A. T. & Ayuningtyaswati, D. (2024). Determinants of Import in Asean Economic Community. International Journal of Professional Business Review (JPBReview), 9(1), 1–10. https://doi.org/10.26668/businessreview/2023.v9i1.4043
Yotov, Y.V., Piermartini, R., Monteiro, J.-A. & Larch, M. (2016). An Advanced Guide to Trade Policy Analysis: The Structural Gravity Model.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Khalid Garba
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.
Authors who publish in this journal agree to the following terms: the author(s) authorize(s) the publication of the text in the journal;
The author(s) ensure(s) that the contribution is original and unpublished and that it is not in the process of evaluation by another journal;
The journal is not responsible for the views, ideas and concepts presented in articles, and these are the sole responsibility of the author(s);
The publishers reserve the right to make textual adjustments and adapt texts to meet with publication standards.
Authors retain copyright and grant the journal the right to first publication, with the work simultaneously licensed under the Creative Commons Atribuição NãoComercial 4.0 (http://creativecommons.org/licenses/by-nc/4.0/), which allows the work to be shared with recognized authorship and initial publication in this journal.
Authors are allowed to assume additional contracts separately, for non-exclusive distribution of the version of the work published in this journal (e.g. publish in institutional repository or as a book chapter), with recognition of authorship and initial publication in this journal.
Authors are allowed and are encouraged to publish and distribute their work online (e.g. in institutional repositories or on a personal web page) at any point before or during the editorial process, as this can generate positive effects, as well as increase the impact and citations of the published work (see the effect of Free Access) at http://opcit.eprints.org/oacitation-biblio.html
