Technological Innovation and Economic Performance in Developing Countries: Evidence from Nigeria

International Journal of Research and Innovation in Social Science (IJRISS) | Volume III, Issue V, May 2019 | ISSN 2454–6186

Technological Innovation and Economic Performance in Developing Countries: Evidence from Nigeria

Samuel B. Adewumi¹, Ngozi B. Enebe²

^1,2Department of Economics, University of Nigeria, Nsukka, Nigeria

Abstract: – This study examines technological innovation and economic performance of developing countries with evidence from Nigeria. The study employed data from 1981 to 2016, and with variables such as gross domestic product, stock of physical capital, technology – proxy by total factor productivity, foreign direct investment, labour force and trade openness. The result yield support to the theoretical postulation of Solow and Swan (1986) that technological innovation is the driving force of growth; and for a state/country to move beyond the steady state, advancement in technology is equally the motivating factor. We conclude that for LDC’s to achieve a meaningful economic growth, greater attention must be given to technological development, which could be through innovation or technological transfer.

Key words: Technology, Capital stock, Economic growth

Jel classification: O33, 040

I. INTRODUCTION

The major growth in macroeconomic indicators is measured by the growth in national income, as this signifies the growth in production, investment, employment, export and consumption (Gurgula and Lach, 2013). Over time, economists have been on the quest to examine the sources as well as factors that propel the growth in economic output as well as economic development, and with recent works focusing on developing countries. From various conventional views emanated from different economists, economic growth has been viewed as a result of the transition of surplus labour from the capitalist sector and the subsistence sector (Lewis (1954)). To Harris and Todaro (1970), Gunnar (1968) and Fields (1980) economic growth and development involves the movement of people from rural to the urban area due to expected income differentials between rural and urban. To Solow and Swan (1956), growth in economic output is mainly a function of the stock of capital (capital formation/ accumulation), coupled with the growth rate in labour force and technological progress. Denison (1967) also buttresses the importance of capital accumulation in propelling economic growth.

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