WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 20, 2023
Liberalization and Economic Growth in Nigeria
Authors: , ,
Abstract: This study looked at how Nigeria’s financial markets, economic growth, and liberalization interacted between 1986 and 2020. To account for both the short-run and long-run effects, the study used an econometric model of autoregressive distributed lag modelling. To check the time series qualities, several diagnostic tests were carried out, including descriptive statistics, a correlation matrix, and a unit root test. Inferences were drawn at the 5% significant level. The study’s findings confirmed that while trade openness had a statistically significant negative impact on economic growth [ =-1.4391; P -value = 0.0000], foreign ownership of shares had a statistically favorable impact [ = 0.3027; P -value = 0.0000]. Additionally, it was shown that during the studied years, inflation was negative but minor in relation to economic growth [ = -0.0032; P-value = 0.5870]. Based on the study’s findings, it was advised that an enabling macroeconomic environment be present to make use of the advantages that financial liberalization and the financial market have to offer. Financial liberalization requires a favorable macroeconomic climate, according to studies. Macroeconomic instability makes information asymmetry worse and makes the financial sector more vulnerable. If the macroeconomic indicators are stable, foreign investors will be more eager to make investments in Nigeria.
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Keywords: Auto Regressive Distributed Lag, Economic Growth, Financial Markets, Gross Domestic products, Liberalization
Pages: 1278-1288
DOI: 10.37394/23207.2023.20.114