Oil Resource Curse Syndrome: Empirical Evidence from Nigeria

Suleiman SA’AD, Muhammed Hamisu YAU

Abstract


The paper investigates the natural resource curse hypotheses in oil – rich Nigeria. The study used time series data on real GDP, contribution of oil rents, contribution of agriculture and manufacturing in real GDP as well as exchange rates and FDI. The VAR models are employed to estimate the relationships, the result of the study is consistent with previous studies for Nigeria. However, empirical evidence suggests that   the was an elements of  Dutch disease syndrome in the Nigerian economy during the last four decades which can be attributed to  internal factors such as policy failure and corruption rather than the happenings in the international oil markets.  We conclude that surge in oil revenues led to distortions in growth path of the Nigerian economy, before the discovery of oil, Nigeria was at par with some middle income OECD and high income developing countries, but four decades after the discovery of oil, Nigeria was pushed back behind all those countries; therefore, the study did not out rightly conclude that oil did contribute positively to growth of Nigerian economy, but it distorted the workings of the economy by encouraging non-coherent policies and unsustainable spending  as well as large scale corruption and struggle for oil rents among the political class which cast a big question as to whether oil is a blessing or a curse in Nigeria. 


Keywords


Oil; Resource Curse; Nigerian Economy

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DOI: http://dx.doi.org/10.20321/nilejbe.v2i2.50

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