Abstract:
The study examined the degree of competitiveness in the export demand for Nigerian rubber
with focus on the Spanish Market. The study covered the periods of 1961 – 2010 and data
comprised national aggregates. Two Stage Least Squares (2SLS) approach was used in the
estimation after instrumenting for simultaneity and establishing stationarity cum cointegration
relationship. The outcome of the analysis showed that the demand for Nigerian rubber by
Spain was affected negatively by export price of the commodity and income of the importing
country. The coefficients of export price of the substitute crop and world production excluding
participating countries traced out a positive relationship. The result further showed that there
is relative competitiveness in the Spanish market on the strength of the Lerner index of 0.015.
The study recommends the allocation of more resources to the export crop through deliberate
budgetary allocation to the producing states and exchange rate stabilization policies are
strongly advocated among others
