Energy Demand and Manufacturing Value-Added in Some Selected Sub-Saharan African Countries: a Translog Function Approach
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Ajide, K. B.
University of Lagos Press and Bookshop Ltd
This study investigated the impact of the energy demand on manufacturing value-added in some selected Sub-Saharan Africa (SSA) countries. It adopted the production theory but augmented with energy demand as an input into the production function. In order to empirically determine the impact of production inputs (energy demand, capital, and labour) on manufacturing value-added, a Translog production function was specified in which a static panel estimation technique (pooled, fixed and random effect model) was adopted. The result reveals that the impact of energy demand and labour on the manufacturing value-added in the selected SSA countries appeared positive and significant while capital has an insignificant impact. However, the interaction of energy with each of labour and capital has a positive significant impact on SSA manufacturing value-added. Thus, oil-producing countries in SSA, (like Nigeria) should make effort to refine their oil locally, rather than selling crude oil and importing refined petroleum products, which are most times not cost effective. The manufacturing industries should equally seek more efficient sources of energy (solar, converter, etc.) for their productions.
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Translog Production Function, , Sub-Saharan Africa Region , Energy demand
Ajide, K. B. (2016), Energy Demand and Manufacturing Value-Added in Some Selected Sub-Saharan African Countries: a Translog Function Approach. Nigeria's Industrial Development, Corporate Governance and Public Policy. 203-218