The determinants of participation in global value chains: The case of ECOWAS

Figures & data

Table 1. Panel unit root tests results

	Common unit root process		Individual unit root process
	Levin, Lin & Chu t-stat		Im, Pesaran and Shin W-stat		ADF - Fisher χ^2		PP - Fisher χ^2
	Statistic	Prob.	Statistic	Prob.	Statistic	Prob.	Statistic	Prob.
Openness (1st differences)	−8.67593	0.0000	−8.22814	0.0000	107.198	0.0000	127.132	0.0000
Manufacturing value added	−3.1262	0.0009			40.1662	0.0639	56.460	0.0011
Intra-community trade	−2.53457	0.0056	0.46353	0.6785	22.3873	0.7631	29.712	0.3771
Domestic value added (1st differences)	−5.97155	0.0000			87.7214	0.0000	101.46	0.0000
Complementarity index	−2.84974	0.0022	−3.30902	0.0005	54.0375	0.0022	51.496	0.0044
Tariffs rate	−15.8138	0.0000	−7.33126	0.0000	48.3783	0.0049	57.1579	0.0004
Diversification indices	−5.79776	0.0000	−5.20552	0.0000	77.0805	0.0000	76.133	0.0000
Similarity in trade structures	−5.21027	0.0000	−4.47447	0.0000	73.3900	0.0000	70.750	0.0000
Real GDP per capita (log)	−1.85913	0.0315	−0.51043	0.3049	43.9010	0.0284	26.241	0.5598
Foreign direct investment	−3.20278	0.0007	−3.93766	0.0000	59.5463	0.0005	65.130	0.0001
Backward (1st differences)	−3.85097	0.0001	−4.31123	0.0000	77.8566	0.0000	87.502	0.0000

Figure 1. Intra-Community trade of selected integration in percentage.

Source: Author, based on IMF and UNCTAD data, 2017. Notes: ASEAN (Association of Southeast Asian Nations) ECOWAS (Economic Community of West African States) MERCOSUR (Southern Common Market) SADC (Southern African Development Community) EAC (East African Community).

Figure 2. Selected integration, domestic and foreign value added in US dollars.

Source: Author, based on OECD TiVA and EORA data, 2016. Notes: ASEAN (Association of Southeast Asian Nations) ECOWAS (Economic Community of West African States) SADC (Southern African Development Community).

Figure 3. ECOWAS domestic and foreign value added in US dollars.

Source: Author, based on OECD TiVA and EORA data, 2016.

Figure 4. ECOWAS countries domestic and foreign value added, 2012.

Source: Author, based on OECD TiVA and EORA data, 2016.

Table 2. Results of panel regression of trade openness and backward integration

Variables	Model (1)	Model (2)
	Trade openness	Backward		Forward
	Robust standard error coefficient	Ordinary coefficient	Robust standard error coefficient	Robust standard error coefficient
Share of manufacturing value added		−0.13938***	−0.13938***	0.06969***
		(0.05138)	(0.04177)	(0.02088)
Intra-community trade	0.34175	1.17773***	1.17773***	−0.48886***
	(1.49220)	(0.14740)	(0.38890)	(0.19445)
Per capita domestic value added (lag)	0.81497**	−0.08318*	−0.08318*	0.04159**
	(0.38380)	(0.04322)	(0.03827)	(0.01913)
Trade complementarity index		0.08715	0.08715	−0.04357*
		(0.06663)	(0.04663)	(0.02331)
Average tariffs rate	0.46016	0.13872***	0.13872***	−0.06936***
	(0.46732)	(0.05233)	(0.06902)	(0.03451)
Merchandise diversification indices		1.49819***	1.49819***	−0.74909***
		(0.2831)	(0.39909)	(0.19954)
Similarity in merchandise trade		1.38605***	1.38605***	−0.69302***
		(0.28542)	(0.39780)	(0.19890)
Real GDP per capita (log)	−0.17321**(0.07676)	−0.01892**	−0.01892**	0.00946**
		(0.00885)	(0.00807)	(0.00404)
Foreign direct investment inflows	−0.02881	0.01905*	0.01905*	−0.00521***
	(0.08972)	(0.00997)	(0.01031)	(0.00515)
Backward(lag)	1.24954*(0.68257)
Constant	1.15407**	−1.25227***	−1.25227***	1.12613***
	(0.49062)	(0.28186)	(0.41946)	(0.20973)
Number of observations	252	252
F-test	8.73985***	54.4566***
R^2	0.60228	0.91227
Country fixed effects	Yes	Yes
Time fixed effects	Yes	YesYes
Kao Residual Cointegration Test Ho: No cointegration
t-Statistic (ADF)	−2.67052***	−2.660***
Hausman Test Ho: difference in coefficients not systematic
χ^2(10)	15.055***	55.086***
Prob > χ^2	0.0046	0.0000

Note: Standard errors are in parentheses.

^* Significant at 10%.

^** Significant at 5%.

^*** Significant at 1%.