Domestic Investment, Foreign Direct Investment and Macroeconomic Stability in Nigeria
Journal Title: Journal of Economics, Finance and Management Studies - Year 2021, Vol 4, Issue 05
Abstract
: This study examines the relationship between the two major investment components (domestic investment and foreign direct investment) and macroeconomic stability in Nigeria. In order to capture the macroeconomic stability, some selected macroeconomic variables are presented, namely: real GDP growth rate (RGDPgr), trade openness (TOP), exchange rate (EXR), inflation rate (INFR), interest rate (INTR), private sector credit (PSC) which represent domestic variables and world oil price (WOP) which represent foreign variable. The study employs Johansen cointegration and Vector Autoregressive model as the estimation techniques. Findings from the study reveals that there is no long-run relationship between the selected macroeconomic variables and the two investment variables. The study also reveals that shocks and fluctuations from real GDP growth rate (RGDPgr), private sector credit (PSC), inflation rate (INFR), interest rate (INTR), exchange rate (EXR) and world oil price (WOP) strongly and significantly affect domestic investment in Nigeria; while the shocks and instabilities arising from real GDP growth rate (RGDPgr), inflation rate (INFR), interest rate (INTR), exchange rate (EXR), trade openness (TOP) and world oil price (WOP) majorly and significantly affect foreign direct investment in Nigeria during the period under review. The study therefore recommends that Nigerian government should provide stability measures in all the aforementioned macroeconomic indicators, as this will attract a higher level of FDI and this will create an enabling business environment for domestic investment to operate.
Authors and Affiliations
Saliu Mojeed Olanrewaju
Keywords
Related Articles
- EP ID EP695051
- DOI https://doi.org/10.47191/jefms/v4-i5-12
- Views 162
- Downloads 0
Growth Opportunities and Default Risk among Nonfinancial Firm Listed in Kenya
This paper analyses the impact of growth opportunities on default risk of nonfinancial listed firms in Kenya. The study employ panel data analysis to study the 31 nonfinancial listed firms between 2011 and 2020. Default...
Low Cost Innovation: Implementation in Footwear Industries that Produce for Consumers at the Base of the Pyramid – Bop
This article presents an approach to the theory of innovation in low-cost industries that produce for the Base of the Pyramid - BOP, and aims to propose a set ofproceduresthat define and guide implementation in processes...
Analysis of the Economic Profitability and Determinants of The Adoption of Improved Cowpea Varieties Korobalen IT89KD374 in the Segou Region
This study focuses on the adoption of improved cowpea varieties Korabalen. It involved 81 producers in the Commune of Sakoïba chosen randomly, more precisely those from the village of Zogofina. The data collected are bot...
The Influence of Self-Efficacy on Employee Performance through Job Satisfaction in Operational Support Personnel for Malang City Social Service Activities
The purpose of this research is to determine the effect of self-efficacy on employee performance through job satisfaction. The uniqueness of this research is that the research results are presented to improve government...
The Influence of Financial Literacy, Financial Awareness, And Income On Financial Well-Being With Financial Behavior And Financial Inclusion As Intervening Variables (A Case Study On Families In Surabaya)
As a result of the Covid-19 pandemic, the Indonesian economy has been severely affected. Surabaya city's economy contracted by -4.85% in 2020 and by 2021 it grew to 4.29%. Surabaya's poverty rate in 2021 is 5.23%, or 152...