Testing the Solow model in Nigeria’s economy
This study empirically tests the Solow model using the Nigeria’s economy as a case study. The study utilized the ordinary least square techniques and annual time series data spanning the years (1970-2012). The Basic Solow model and the Augmented Solow model were estimated. While the Basic Solow model was completely validated using the Nigeria’s economy, the Augmented Solow model was non-compliant with prescriptions by Romer, Mankiw & Weil. The study recommended among others the creation of enabling environment for an effective macroeconomic policy framework that supports the Solow model, policy consistency and the integration of Solow variables into policy formulation.
Keywords: Basic Solow Model, Augmented Solow model, OLS, Nigerian economy