Nexus Between Technological Innovation and Economic Growth: Evidence From Nigeria (1980-2018)

Ebunoluwa OYEGOKE, Osman Nuri ARAS


Technological innovation in developing countries is inherently identified with the transfer of technology from the advanced country via trade, FDI and importation of capital and intermediate goods, machinery and other forms of embodied technology (ETC). This is due to low investments in in-house research and development (R&D) activities by local producers, hence, the need for technology transfer and spillover. This study contributes to existing knowledge by examining the empirical short-run and the long-run relationship between technological innovation and economic growth, a case study of Nigeria using the ARDL model on annual time series data spanning from 1980-2018. The f-bound cointegration test shows a long-run relationship among the variables at 5% significant level. Overall, is the results show a positive relationship between innovation in the form of technology transfer and spillover, and economic growth at 5% level of significance. Based on these findings, we propose that technological innovation should be encouraged; however, in-house innovation activities (R&D) should be encouraged due to its peculiarity to the economic structure of the country.


Technological Innovation, R&D, Patents, Economic Growth, Nigeria

Full Text:



Arntz, M., Gregory, T., and Zierahn, U. (2016). The risk of automation for jobs in OECD countries: A comparative analysis. Working Paper No. 189. Paris, France: OECD Publishing.

Broughel, J., & Thierer, A. D. (2019). Technological innovation and economic growth: A brief report on the evidence. Mercatus Research Paper. Center at George Mason University, Arlington, VA, 1-29.

Brynjolfsson, E., & McAfee, A. (2011). Race against the machine: How the digital revolution is accelerating innovation, driving productivity, and irreversibly transforming employment and the economy. Brynjolfsson and McAfee.

Bujari, A. A., & Martinez, F. V. (2016). Technological Innovation and Economic Growth in Latin America. Revista Mexicana de Economia y Finanzas, 11(2), 77-89.

Czarnitzki, D., & Toivanen, O. (2013, April). Innovation Policy and Economic Growth. Economic Papers, 482, pp. 1-44.

Danaher, J. (2017). Will life be worth living in a world without work? Technological unemployment and the meaning of life. Science and engineering ethics, 23(1), 41-64.

Elliott, S. (2007). Projecting the Impact of Computers on Work in 2030. National Research Council, 1-38.

Frey, C. B., & Osborne, M. A. (2017). The future of employment: How susceptible are jobs to computerisation?. Technological forecasting and social change, 114, 254-280.

Haq, I. (2018). Impact of innovation on economic development: Cross nation comparison of Canada, South Korea and Pakistan. Journal of Economic Info, 5(3), 7-15.

Iyobiyo, M., & Na-Allah, A. R. (2014). Innovation and economic growth: evidence from Nigeria. EuroEconomica, 33(1), 1-12.

Kacprzyk, A., & Doryń, W. (2017). Innovation and economic growth in old and new member states of the European Union. Economic research-Ekonomska istraživanja, 30(1), 1724-1742.

Lanier, J. (2013). Who owns the future?. New York: Simon & Schuster.

Maradana, R. P., Pradhan, R. P., Dash, S., Gaurav, K., Jayakumar, M., & Chatterjee, D. (2017). Does innovation promote economic growth? Evidence from European countries. Journal of Innovation and Entrepreneurship, 6(1), 1-23.

Miller, B., & Atkinson, R. D. (2014). Raising European productivity growth through ICT. ITIF, June.

Nickell, S. J., & Van Reenen, J. (2001). Technological innovation and economic performance in the United Kingdom."Country Studies": Innovation and Economic Performance. New York: Council of Foreign Relations.

Nkoro, E., & Uko, A. K. (2016). Autoregressive Distributed Lag (ARDL) cointegration technique: application and interpretation. Journal of Statistical and Econometric methods, 5(4), 63-91.

Onyeiwu, S. (2011). Does Lack of Innovation and Absorptive Capacity Retard Economic Growth in Africa? UNU-WIDER: World Institute for Development Economic Reserach, Working Paper No. 2011(19), 1-27.

Pece, A. M., Simona, O. E. O., & Salisteanu, F. (2015). Innovation and economic growth: An empirical analysis for CEE countries. Procedia Economics and Finance, 26, 461-467.

Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of applied econometrics, 16(3), 289-326.

Raja, D. S. (2016). Bridging the disability divide through digital technologies. Background paper for the World Development report.

Romer, P. M. (1986). Increasing returns and long-run growth. Journal of political economy, 94(5), 1002-1037.

Schumpeter, J. A. (1982). The theory of economic development: An inquiry into profits, capital, credit, interest, and the business cycle (1912/1934). Transaction Publishers.-1982.-January, 1, 244.

Solow, R. M. (1956). A contribution to the theory of economic growth. The quarterly journal of economics, 70(1), 65-94.

Verspagen, B. (2005). Innovation and Economic Growth. (Eds: J. Fagerberg, D. C. Mowery, & Nelson, R.R.). The Oxford handbook of innovation. Oxford university press.

Vivarelli, M. (2012). Innovation, employment and skills in advanced and developing countries: A survey of the literature. IZA Discussion Paper, No.62691.

Vivarelli, M. (2015). Innovation and employment. IZAWorld of Labor, No.154.

Zuniga, P., & Crespi, G. (2012). Innovation strategies and employment in Latin American firms. Structural Change and Economic Dynamics, 24, 1-17.


  • There are currently no refbacks.

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.