Abstract
AbstractThis study empirically examines the independent effects of stock market and banking sector development on economic growth in Nigeria over the period 1981–2014 using the autoregressive distributed lag (ARDL) approach to co-integration analysis. Controlling for the possible effects of crude oil price and trade openness on economic activities in Nigeria, this study found both stock market and banking sector development insignificant in influencing economic growth in Nigeria. In general, the results highlight the weakness of the Nigerian financial sector in stimulating economic growth through resource mobilisation and allocation and the dominant role of the oil sector in economic activities in Nigeria.
Highlights
Recent years have witnessed a growing interest among researchers in understanding the interaction between financial sector development and economic growth in oil-exporting countries
Controlling for the influence of crude oil price and trade openness on economic growth in Nigeria, this study examines the independent effects of stock market and banking sector development on economic growth in Nigeria using the autoregressive distributed lag (ARDL) approach to cointegration analysis over the period 1981–2014
The results suggest that both stock market and banking sector development are not significant drivers of economic growth in Nigeria
Summary
Recent years have witnessed a growing interest among researchers in understanding the interaction between financial sector development and economic growth in oil-exporting countries (see Nili & Rastad, 2007; Beck, 2011; Barajas, Chami, & Yousefi, 2013; Cevik & Rahmati, 2013; Samargandi, Fidrmuc, & Ghosh, 2014). Chinazaekpere Nwani is an academic staff in the Department of Economics, Banking and Finance, Gregory University Uturu, Uturu Abia State, Nigeria His area of research interest is financial economics with bias in development finance, energy finance, financial markets and institutions, asset pricing and portfolio theory and how they influence the economic growth process of developing oil-exporting economies and subSaharan African countries. Jacob Bassey Orie is a senior lecturer and researcher in the Department of Economics, Banking and Finance, Gregory University Uturu, Uturu Abia State, Nigeria. He holds PhD in Development Economics from the University of Port Harcourt, Nigeria
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