Bounds Test Approach to Co-Integration and Causality between Foreign Investment Inflows and Exchange Rates Dynamics in Nigeria.
Journal Title: IOSR Journal of Humanities and Social Science - Year 2019, Vol 24, Issue 1
Abstract
This study was commissioned to investigate for long run and causal relationship between foreign investment inflows and exchange rate dynamics in Nigeria. Foreign capital is decomposed into foreign direct investment (FDI) and foreign portfolio investment (FPI) to enable us look at both the real and financial sectors of the economy. Results established that there exists a long run association between exchange rates dynamics and foreign capital inflows to Nigeria. This was evident by the values of bound test F-Statistic of 61.82058 and 33.18053 for foreign direct investment and foreign portfolio investment models respectively. The coefficients of error correction terms lagged one period in the short-run models of FDI and FPI are negative and statistically significant at 1% level, meaning that in the both models, the independent variables jointly and significantly cause FDI and FPI respectively at least in the short run. Furthermore, this study has established that, for Nigeria, exchange rate ranks as one of macroeconomic fundamental that exact significant influence in moderating foreign direct investment (FDI) flows, while its effect on foreign portfolio investment (FPI) movements appears to be inconsequential, meaning that exchange rate should not be contemplated as instrument for moderating foreign portfolio inflows in Nigeria.
Authors and Affiliations
BigBen Chukwuma Ogbonna
Keywords
Related Articles
- EP ID EP443033
- DOI 10.9790/0837-2401064960.
- Views 70
- Downloads 0
How Far Are We From Achieving Inclusive Education Through Sarva Shiksha Abhiyan?
Why when a child is born with disabilities s/he is considereda burden to the family? Why does the society treat them as a taboo? Is it the mistake of only parents?Or the entire system and society is to blame for? Which h...
The Role of Customer Relationship Management in Mediating Market Orientation on Marketing Performance
This study aims to analyze the effect of market orientation and customer relationship management on marketing performance, as well as the role of customer relationship management mediation on market orientation relations...
A Study on Leisure Time Book Reading Preferences among the Students of RAK Medical and Health Sciences University, UAE.
Reading is considered to be one of the best ways to develop, educate and entertain oneself. It broadens creativity and gives the reader an opportunity to explore the world while sitting on his couch. It not only gives a...
Factors that Influence Primary School Participation of Epileptically Affected People in Me’enit Goldia Woreda Bench Maji Zone, Ethiopia
This study has been undertaken to explore the influencing factors that limit the primary school participation of epileptic communities in Me‟enit people who live in Me‟enit Goldia wereda at Bench Maji zone administration...
Environmental Impact on Safe Drinking Water and Livelihood in Urban Slum of Barisal Metropolitan City of Bangladesh
Bangladesh is widely recognized as one of the most climate vulnerable countries in the world. Polaspur slum of Barisal city has been selected for the study. The study area is the most vulnerable area to the natural hazar...