SERVICE SECTORS FOREIGN EXCHANGE TRANSACTION INCENTIVES AND ECONOMIC GROWTH IN NIGERIA

Abstract

The service sector is a crucial component of economic growth, and it has been noticed as a sector with a greater capability that plays role in sustained economic growth and development in developing countries like Nigeria. Therefore, the study seeks to examine the impact of service sectors' foreign exchange transaction incentives on economic growth in Nigeria. The study employed the Time Series data and used ARDL and ECM in the estimation of variables. both long-run and short-run results revealed that the transportation sector foreign exchange transaction incentive has a positive and significant impact on economic growth in Nigeria. On the other hand, the education sector foreign exchange transaction incentive has a negative and insignificant impact on economic growth in Nigeria both in the long and short run. Therefore, the paper recommended that government should adopt both long and short-term policies of transportation sector foreign exchange transaction incentives for economic growth in Nigeria because of its positive and significant impact on economic growth in the short run and long run and the government should redesign policy in improving the education sector foreign exchange transaction incentive for economic growth in Nigeria because of its negative and insignificant impact on economic growth in the short run and long run.