AN EXAMINATION OF THE EFFECTS OF GLOBALIZATION ON ECONOMIC GROWTH AND POVERTY REDUCTION IN DEVELOPING NATIONS

CHAPTER ONE INTRODUCTION 1.1 Background to the Study Globalization refers to the accelerated integration of economies and markets, heightened financial flows, advancements in information technology, and increased cultural interactions across borders. It also denotes the reconfiguration of global capitalism, characterized by the rising influence of multinational financial institutions, corporations, and technological innovations. According to Kwanashie, Mike (2003), economic globalization is a historical progression rooted in human creativity and technological advancement. This phenomenon encompasses the cross-border movement of labor and technology and has a well-established theoretical foundation. The revival of laissez-faire economic ideology helps explain its rise, as it encompasses both an analysis of evolving global patterns in work, trade, and finance, and a strong belief in the capacity of deregulated markets to produce optimal outcomes for economic growth and human development. A common belief associated with globalization is that the expansion of the global economy inherently leads to improvements in human welfare. Taiwo (2001) observes that the concept of poverty alleviation has become a popular theme among Nigerian political leaders since the return to democratic governance in 1999. These leaders frequently reference poverty alleviation in their rhetoric to demonstrate their supposed commitment to improving the welfare of the populace. However, many of them appear to lack a true understanding of what is required to effectively reduce the suffering of the poor. Government-initiated poverty alleviation programs have often fallen short of empowering people or significantly improving their living conditions. This shortfall is one of the reasons why poverty remains widespread in Nigeria despite various initiatives. The depth of poverty in the country is so apparent that it requires little verification. To address poverty effectively, Nigerian leaders might consider adopting strategies implemented in developed nations. These strategies include the establishment of robust welfare systems, job creation, affordable healthcare services, guidance and counseling programs, investments in public education, the provision of affordable housing, public discussions on teenage pregnancy, effective law enforcement through community policing, as well as literacy and parenting programs. Meaningful poverty alleviation in Nigeria will require a similar comprehensive approach. Any government—federal, state, or local—that is genuinely committed to alleviating poverty must align its programs with these types of interventions in order to achieve measurable outcomes. Furthermore, it is important to recognize that globalization does not operate in isolation; rather, it is interconnected with other major economic concepts such as privatization, deregulation, and commercialization. Numerous national and international forums, campaigns, and symposia have advocated for increased trade both within and across national borders, emphasizing the need for global economic development and cooperation. 1.2 Statement of the Problem The globalization of the world economy presents considerable opportunities to countries that can effectively harness it for the advancement of their human capital and overall development. Although globalization offers potential benefits to Nigeria—such as increased capital inflows, access to technological innovations, and reduced costs of imports—these advantages are not equitably shared among all nations. As a result, certain countries, particularly those in the developing world like Nigeria, often find themselves disadvantaged. The greatest benefits of globalization have predominantly accrued to developed nations, thereby widening the income disparity between high-income and low-income countries. Consequently, a significant portion of the population in low-income nations continues to live in severe poverty. Nigeria, in particular, has struggled to fully benefit from globalization due to the underdevelopment of key sectors that serve as the engines for global competitiveness. To position itself effectively in the global market, Nigeria must implement comprehensive poverty alleviation programs, ensure stable electricity supply, promote technological innovation, revamp its manufacturing industry, and restructure other critical sectors to support sustainable growth. Challenges such as the influx of foreign goods—commonly referred to as dumping—have further hindered the performance of Nigeria’s local manufacturing sector. Alongside issues like political instability, economic volatility, and financial constraints, these challenges have weakened domestic industries. Foreign competitors have taken advantage of the vulnerabilities in Nigeria’s market, thereby limiting the growth potential of indigenous enterprises. In light of these issues, this research seeks to critically examine the impact of globalization on Nigeria’s economic development. The study aims to understand the dynamics between globalization and the nation’s development trajectory, particularly in the context of poverty alleviation and economic competitiveness. 1.3     AIM AND OBJECTIVES OF THE STUDY The aim of this study is to examine the Effects of Globalization on Economic Growth and Poverty Reduction in Developing Nations. The following .are the specific objectives of the study: 1.     To examine the impact of globalization and poverty alleviation in developing countries like Nigeria. ii.      To examine the causes of poverty in developing countries. iii.     To examine the effects of globalization and poverty alleviation programmes in developing countries using Nigeria as a case study. 1.4     RESEARCH QUESTIONS Therefore, the statements of problems are stated below by finding answers to the following questions: a.   What are the impacts of globalization and poverty alleviation to Nigerian economy? b.    What are the cause~ of poverty in developing countries using Nigeria as a case study? c.      What are the effects of globalization and poverty alleviation to economic growth of Nigeria? 1.5     SIGNIFICANCE OF THE STUDY It is generally accepted fact that globalization is global and dominant-In the world, today. The differences· in the socioeconomic development across nations are attributed much to the development of the concepts of globalization and poverty alleviation in developing countries like Nigeria. In view of the above the importance of this study will includes: i.  Globalization has become a "threat to the poor rather than an opportunity for global action. ii.   Many economists and policy maker analysts argued that globalization particularly the increase mobility of international financial capital, has undermined the ability of countries "to engage in independent macroeconomic policies, whether fiscal or monetary policies. iii.     And implications of this are that government is less able to insulate programmes to alleviate poverty and their economies from the adverse effects of trade. iv.     Any government that "is sincere about alleviating the suffering of the people be it at the federal, state or local government levels should begin to work in line with the above mentioned programmes in order to achieve results. 1.6     RESEARCH HYPOTHESES Based on the research problems and objectives of the study, the following hypotheses have been formulated for subsequent verification; Hypothesis One Ho:    There is no significant relationship between globalization and poverty alleviation in developing countries. HA:   There is significant relationship between globalization and poverty alleviation in developing countries. Hypothesis Two Ho:   There is no significant relationship between globalization and causes of poverty in developing countries. HA: .    There is significant .relationship between globalization and causes of poverty in developing countries. Hypothesis Three Ho:    There is no significant relationship between globalization and effects of globalization to economic growth of Nigeria. HA:      There is significant, relationship between globalization and effects of globalization to economic growth of Nigeria. 1.7     RESEARCH METHODOLOGY The methodology to be employed in the course of this research work is analytical as a mode of investigation. Secondary source of data will be based by way of information obtained from the National Planning Commission, Federal Office of Statistics, and other governmental and non-governmental organizations. Other information will be obtained from annual reports, journals, magazines and the internet. However, in this research work the method of estimation is based on the use of multiple regression technique using the regress and regressor terminology. Econometric techniques shall be used to study the relationship between the explained and explanatory variables in mathematical form. Economic theory and variable information that is related to the subject matter as well as published studies on the subject by other research workers shall be used in specifying the econometric model. 1.7.1  MODEL SPECIFICATION GDP = ao + alINT + a2CPI + a3GCF + a4INV + µ Dependent Variables GDP = Gross Domestic Product Independent Variables PVT = Poverty Alleviation GLO= Globalization EC = Economic Growth INV = Investment (Aggregate) ao = Intercept or Constant term of the relationship al- a4 = Parameters of Co-efficient U1 = Stochastic Factor 1.8     SCOPE OF THE STUDY The study shall focus on the Effects of Globalization on Economic Growth and Poverty Reduction in Developing Nations using Nigeria as a case study. This study additionally identifies the impact of globalization, the causes of poverty in developing countries, the effect of poverty alleviation and globalization to economic growth of Nigeria using Nigeria. 1.9    LIMITATION OF THE STUDY The major relevant limitation or limiting factor for this study was difficulty in getting relevant information from appropriate sources. 1.10     PLAN OF THE STUDY This project work is divided into five (5) chapters and they are as follows; Chapter one consists of' the introduction, statement of the problems, research questions, aim and objectives of the study, research hypothesis, significance of the study, research methodology, scope of the study, limitation of the study, plan of. the study and the references. Chapter two also focuses on the review of intensive, which is rent to review previous works that are related to the topic under study. Chapter three consists of structural composition ofthe study. Chapter four also consists of research methodology, data analysis, interpretation and presentation of the results while chapter five consists of the summary, findings, recommendations, conclusion, then followed by the references.