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Capital Market and Economic Growth in Nigeria

Taiwo, J.N. and Alaka, Adedayo and Afieroho, Evawere O (2016) Capital Market and Economic Growth in Nigeria. Account and Financial Management Journal, 1 (8). pp. 497-525. ISSN 2456-3374

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This study seeks to evaluate the contribution of capital market to the growth of Nigeria’s economy. To achieve this objective, an error correction model was estimated for economic growth in Nigeria, using Vector Error Correction techniques on an annual time series data spanning from 1981 to 2014. The data were subjected to Phillip Perron Unit Root Test at level and first difference. The result shows that, at one percent significance level, all the variables were stationary at first differencing. The result of the normalized cointegrated series further reveals that market capitalization rate, total value of listed securities, labor force participation rate, accumulated savings and capital formation are significant macroeconomic determinants factors of economic growth in Nigeria. It was then recommended that, for the capital market to realizes its full potentials, its environment must be enabled to promote and encourage investment opportunities for both local and international investors, since the stock market operates in a macroeconomic environment. Consequently, an improvement in the Nigerian trading system with the aim of increasing the ease with which investors can purchase and sell shares, could guarantee the stock market liquidity

Item Type: Article
Uncontrolled Keywords: Capital Market, Economic Growth, Market Capitalization, Capital Formation
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: 02 Feb 2017 08:32
Last Modified: 02 Feb 2017 08:32

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