Effect of External Debt on Economic Growth: Evidence from Nigeria

Okoye, Lawrence U. and Modebe, Nwanneka J. and ERIN, Olayinka and Evbuomwan, Grace O. (2017) Effect of External Debt on Economic Growth: Evidence from Nigeria. In: 29th International Business Information Management Association Conference, 3-4 May 2017, Vienna Austria.

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Abstract

The study seeks to determine the effect of external debt on economic growth in Nigeria. Specifically, the study examines whether external borrowings and its major determinants like exchange rate, gross fixed capital formation and inflation rate have supported the growth of the Nigerian economy. The parameters of the model were estimated using the ordinary least squares method. The robustness of the result was enhanced using the generalized least squares technique. The result shows evidence of significant positive correlation between economic growth and the explanatory variables namely external debt, exchange rate and inflation rate. A negative correlation was however observed between economic growth and gross fixed capital formation. The regression estimates for both the ordinary and generalized least squares tests show significant positive impact of external debt, exchange rate and inflation rate on economic growth. The results also show non-significant negative effect of gross fixed capital formation on economic growth. The study concludes the external debt has significantly promoted economic growth in Nigeria.

Item Type:	Conference or Workshop Item (Paper)
Uncontrolled Keywords:	External debt, Economic growth, Exchange rate, Inflation rate, Gross fixed capital.
Subjects:	H Social Sciences > H Social Sciences (General) H Social Sciences > HG Finance
Divisions:	Faculty of Law, Arts and Social Sciences > School of Social Sciences
Depositing User:	Mrs Hannah Akinwumi
Date Deposited:	08 Feb 2018 08:02
Last Modified:	08 Feb 2018 08:02
URI:	http://eprints.covenantuniversity.edu.ng/id/eprint/10184

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