Trade Openness and Total Sector Productivity in Zimbabwe: Empirical Analysis Using ARDL and Granger Casuality Approach

Lawrence Dumisani Nyathi, Mthulisi Nkala and Mbheki Mlobane
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Lawrence Dumisani Nyathi: National University of Science and Technology, Lecturer-Department of Banking & Economic Sciences, Faculty of Business & Economic Sciences, Zimbabwe
Mthulisi Nkala: Lupane State University, Graduating Candidate-Department of Accounting & Finance, Faculty of Commerce, Zimbabwe.
Mbheki Mlobane: Lupane State University, Economist-Department of Accounting & Finance, Faculty of Commerce, Zimbabwe.

International Journal of Research and Innovation in Social Science, 2024, vol. 8, issue 11, 2782-2793

Abstract: This study explores the relationship between trade openness and total sector productivity in Zimbabwe using the ARDL and Granger Casuality Approach covering the period 1990 to 2023. The bulk of economic literature do point out that trade openness is a potent catalyst for national development and productivity. Economic literature further provide evidence of the short- and long-term connections between trade openness and economic growth. Given that most nations now desire to generate wealth through international commerce and transfer technology, this study tackles significant issues about the relationship between trade openness and total sectorial productivity. The research findings indicate that trade openness and total sectoral productivity had a positive long-term association. The research also revealed that total sectoral productively is significantly related to inflation, exchange rate, unemployment and labour rate. Therefore, this paper recommends that policy makers and government negotiators in Zimbabwe should put policies that promote openness through the removal of trade barriers and export encouragement into effect in order to increase overall economic growth. In conclusion, some of the trade barriers that are deterring trade openness and productivity are solved if government of Zimbabwe implements a vibrant economy to boost productivity.

Date: 2024
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