Globalisation And Poverty: Evidence From Nigeria

Abstract

Globalization is the process of the integration of economic, political, social and cultural values across international boundaries while poverty as a type of social exclusion that comes when an individual or family fails to meet an established threshold. Therefore, this study investigated how globalization has affected income inequality in Nigeria. The study employed the use of ARDL bounds testing approach to cointegration and the Error Correction Model (ECM). The ARDL Bound test found out that there is a significant long-term correlation between the variables and that each variable is integrated in a different order. The study also discovered that whenever there is an increase in globalization indicators like foreign direct investment, trade balance, and the GDP control variable, the country's poverty rate decreases both in the short and long terms. Following the empirical findings of this study, the following recommendations were made; foster collaboration between government, private sector, civil society, and international organizations to create a comprehensive strategy for poverty reduction, expand cash transfer programs, food security initiatives, and subsidized healthcare to alleviate short-term poverty, provide financial support and access to credit for SMEs to help them compete in a global market, ensure that the benefits of globalization are widely distributed by promoting policies that target income inequality and regional disparities, and encourage innovation and support industries with high potential for growth and job creation through research and development initiatives.