Panel Data Analysis of Economic Growth Determinants in Ecowas Region

Abstract

The study examined the Macroeconomic factors influencing Economic Growth in EconomicCommunity of West African States region using panel data regression. A Pooled ordinaryleast squares, Fixed Effect Model, and Random Effect Model were implemented to fit  thepanel regression model for the panel data sets. The result showed that estimates fromfixed effect model were accurate in  determining the econometric relationship among the variables under study. According to fixed effect model chosen for the dataset under  study, Foreign direct investment, Exchange rate, Export of goods and services and Inflation rate are statistically significant.  Thevariables Foreign direct investment, Inflation rate and External debt have positive impact whilethe Exchange rate and Export of goods  and services variables affect the Economic CommunityofWest African States Countries negatively. Policy makers are therefore  advised to erect antiinflationary policies that attract Foreign Investors, emphasis should be laid on encouragingstableand reasonable  exchange rate to promote even and sustainable Economic Growth.