The Link Between Threshold Level of Trade Liberalisation and Poverty in Economic Community of West African States (ECOWAS)

In order to comprehend how trade openness affects poverty levels and determine the point at which trade liberalisation becomes effective in reducing poverty, this study examines the effects of trade liberalisation on poverty in the ECOWAS area. Key variables like trade liberalisation, per capita income, inflation, education, and exchange rates are all part of the empirical model, which is based on a theoretical framework. The non-linear relationship between trade liberalisation and poverty is investigated using a threshold model. The results show that while poverty tends to rise below this barrier, trade liberalisation has a detrimental effect on poverty when openness surpasses it.The study emphasises the importance of institutional quality, demonstrating how the potential advantages of trade liberalisation are hampered in ECOWAS nations by poor institutions. To make sure that the advantages of trade liberalisation are shared by all, the report advises ECOWAS nations to invest in specific social programs, enhance institutional quality, and expand trade openness. Other important tactics to lessen poverty and inequality in the area include improving infrastructure and education, diversifying the economy, and strengthening governance.