Determinants of the intra-industry trade in cereal and miscellaneous edible preparations: the evidence for Nigeria and the ECOWAS partners

https://doi.org/10.17221/18/2013-AGRICECONCitation:Onogwu G.O. (2014): Determinants of the intra-industry trade in cereal and miscellaneous edible preparations: the evidence for Nigeria and the ECOWAS partners. Agric. Econ. – Czech, 60: 21-30.
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The trade liberalization processes of the Economic Community of West African States (ECOWAS) are implemented through such interventions like free international trade, common external tariff wall, the consolidation or freezing of custom duties and non-tariff barriers to the intra-trade among others. However, the extent to which these efforts have translated to the intra-industry trade in the prepared foodstuff products has not been investigated yet. The objectives of this study are to assess the intra-industry trade theory in cereal and miscellaneous edible preparations; to evaluate the growth rates of simultaneous exports and imports in these prepared foodstuff sub-sections; to evaluate the extent of the intra-industry trade in the sub sections, and to determine the effects of the Nigeria’s and partners’ characteristics on the intra-industry trade. The results revealed that the intra-industry trade in cereal preparations are positively and significantly influenced by the partners’ gross national income (GNI) per capita and the partners’ foreign direct investment (FDI), but they are negatively influenced by the Nigeria’s household final consumption expenditure. Also, the intra-industry trade in miscellaneous edible preparations is influenced positively by the partners’ GNI per capita and the partners’ households’ final consumption expenditures, while the Nigeria’s foreign direct investment and the value added by manufacturing negatively influence the intra-industry trade in the product sub-sections within the ECOWAS sub-region. Both exports and imports growth rates of these products fluctuate, but more in the imports of miscellaneous edible preparations. Cost saving options in transportation, the use of efficient machines during the production, processing and packaging are recommended.
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