IMPACT OF CAPITAL MARKET INDICATORS ON ECONOMIC GROWTH IN NIGERIA

Odo, Stephen Idenyi and Anoke, Charity Ifeyinwa and Uwazie, I. Uwazie (2015) IMPACT OF CAPITAL MARKET INDICATORS ON ECONOMIC GROWTH IN NIGERIA. Journal of Economics and Business Sciences, 3 (1). pp. 129-143.

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Abstract

This study examined the impact of capital market indicators on economic growth in Nigeria from 1986 – 2015. The study adopted co integration, vector error correction mechanism and granger causality econometric tools of estimation to test the variables in the model. The result of the estimation showed a stable long run relationship between the dependent and independent variables as supported by the existence of 3 co integrating equations. The result of the ECM revealed a positive significant relationship among stock traded total value, money supply and economic growth in the long run. In the short run, only STTVGDP maintained a significant positive relationship with the dependent variable. The result of the causality test revealed a unidirectional causality moving from the explanatory variables to the dependent variable and bidirectional causality between economic growth and gross capital formation. The study therefore recommend that capital market development policy should focus on the increase of money supply in the long run as this will stimulate the growth of the capital market especially through increase in the value of shares. More so, there should be deliberate policy to promote development of domestic capital formation through conscious increase in local investment so as to benefit from its positive relationship with economic growth.

Item Type: Article
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HJ Public Finance
Divisions: Faculty of Management and Social Sciences
Depositing User: mrs chioma hannah
Date Deposited: 28 May 2019 09:15
Last Modified: 28 May 2019 13:52
URI: http://eprints.gouni.edu.ng/id/eprint/1581

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