Original scientific paper
https://doi.org/10.1080/1331677X.2020.1804428
Trade liberalisation, economic growth and poverty level in sub-Saharan Africa (SSA)
Claire Emilienne Wati Yameogo
Joseph Ayoola Omojolaibi
Abstract
This paper explores the relationship among trade openness, economic growth and poverty level in 40 sub-Saharan Africa countries from 1990 to 2017. Panel Autoregressive Distributed Lag
(ARDL) model, Panel Vector Auto-regression (VAR) and the System
of Generalised Method of Moments (SYS-GMM) were employed. A
robustness test was also applied. The sensitivity analysis was
done through the Panel ARDL model. The results revealed that
trade openness, foreign direct investment and institutional quality
significantly increase economic growth in the long term, while
institutional quality reduces economic growth in the short run.
Furthermore, trade liberalisation, institutional quality and population growth rate lead to poverty reduction in the long run, while
trade openness has adverse effects in the short run. Moreover,
poverty does not have a significant response to trade and growth
shocks. Poverty presented a positive change but the level was
not significant. The Pairwise Dumitrescu Hurlin Panel Causality
results highlight feedback effects among trade, economic growth
and poverty level in the region. Based on these findings, the
study recommends that governments in Africa should reviewed
their poverty reduction programmes in order to move towards
achieving the sustainable development goals.
Keywords
Trade openness; economic growth; poverty; GMM; subSaharan Africa
Hrčak ID:
301189
URI
Publication date:
31.12.2021.
Visits: 880 *