ECONOMIC LIBERALIZATION AND INDUSTRIAL SECTOR PERFORMANCE IN NIGERIA

This paper empirically analyzes the impact of economic liberalization on industrial sector

performance in Nigeria. Applying the OLS estimation technique with standard errors corrected

for serial correlation on the dummy variable structural break model, this paper holds that

economic liberalization has a significant impact on performance of the Nigerian manufacturing,

mining and quarrying, and power subsectors, respectively and the aggregate industrial sector. The

interaction of the policy with trade openness and financial deepening dampened the performance

of the manufacturing subsector while its interaction with labour force is growth enhancing. Also

the interaction of the policy with energy consumption was negative but financial deepening and

energy consumption has dampening effect on the performance of the mining and quarrying

subsector. While it has enhancing impact on the aggregate industrial sector and was not

significant on mining and quarrying and power subsectors, economic liberalization decreased the

performance of the manufacturing subsector. Beside, financial deepening has mix impact on the

performance of the industrial sector. While it has increasing impact on the aggregate industrial

sector it impact on manufacturing performance is negative.