MIGRATION-TRADE NEXUS IN SUB-SAHARAN AFRICA: EVIDENCE FROM A DYNAMIC PANEL STUDY

Abstract

This study examines the impact of migration on trade in SSA region. We used the system generalized method of moments (GMM) estimator with data for 45 sub-Saharan Africa (SSA) countries from the period 1981-2015 to examine the relationship between migration and trade. The econometric results of our model for migration is negative and significant, this vindicated and validated the Heckscher-Ohlin theory. Furthermore, the econometric results of this study for GDP showed it is significant and positive, population is negative and significant, and lastly exchange rate shows it is significant and positive. In general, the findings of this study supported the theories and previous studies. The robustness test showed similar results with the main results of this study. Our model has passed all the diagnostic tests that were conducted, that is, the Sargan, AR1 and AR2 tests, they were all consistent and are in line with the theory. Hence, we can conclude that our results from these estimations are valid and reliable. This study recommended that migration in SSA should be on control and watch list where this will aid in reducing migration in large numbers and some of the migration issues which trade is one of them.