Foreign Direct Investment, Technological Gap and Total Factor Productivity in Sub-Saharan African Economies

The relevance of foreign direct investments (FDIs) in increasing technical know-how, managerial expertise, and increasing the level of technological availability, and increasing the level of productivity can never be over emphasized. The study adopted the system Generalized Method of Moment (sys-GMM) to account for the issues of endogeneity, the system GMM model to investigate the relationship among technology diffusion variables (foreign direct investment and import of capital goods and services), technology gap (relative backwardness as a proxy by distance from technology frontier and income gap IGAP), natural resources endowment (NRED) and total factor productivity (TFP) in Sub-Sahara Africa countries as specified in the model, while trade openness (TOP) and population growth (POPGW) are the control variables in the model between 1996 and 2022; the data for this study were sourced from the World Bank development indicator and the Central Banks of some selected countries. The result from the model reveals that FDI, NRED, and IGAP are positively related to TFP growth in Sub-Sahara Africa economies. The coefficients are positive and significant at 1% and 5% levels of significance for FDI and NRED respectively but very low,