Exchange Rate Volatility and Trade Flows in Nigeria: An Autoregressive Distributed Lag (ARDL) Bounds Testing Approach

摘要: This study estimated an error correction model of the impact real exchange rate volatility on performance trade flows in Nigeria from 1971 to 2013. Using autoregressive distributed lag (ARDL) bounds testing approach measure volatility. The results revealed that both short-run and long-run, depressed exports imports. Furthermore, sum price elasticities imports demand exceeded unity which implied Marshall–Lerner (ML) condition holds for Nigeria. is indication poor export sector over dependence country imported goods. thus, recommends redenomination naira. will ensures a stronger naira since devaluation or depreciation domestic currency was main ingredient SAP did not work. would improve competitiveness exports. It also help Nigeria’s balance with its trading partners by making machineries equipments less expensive. further indigenous technology should be developed entrench local content production process. increase input output ratio allow forward backward linkages eventually lead greater productivity, efficiency competitiveness.