The Effect of Globalization and Balance of Payment on the Nigerian Economic Growth

Filed in Economics Project Topic by on October 18, 2020

The Effect of Globalization and Balance of Payment on the Nigerian Economic Growth.

ABSTRACT

The study investigated the effect of globalization and balance of payment on the Nigerian economic growth for the period 1985-2014. Time series data on foreign direct investment, foreign portfolio investment, trade openness, external debt service ratio and balance of payment was used to capture globalization.

The techniques of Estimation employed in the study include Ordinary Least Square, Augmented Dickey Fuller (ADF) test, and Johansen Co-integration test using E-views statistical package.

The results showed that the time series data were found to be stationary at levels and there exist an insignificant long run relationship between globalization and economic growth in Nigeria.

Greater effort should be geared towards integration of foreign direct investment through greater foreign participation in the stock market which could be achieved by greater openness to trade.

Government authorities and policy makers should come up with policies that are investment friendly and should make sure that external debts must be contracted solely for economic reasons and not for social or political reasons. This is to avoid accumulation of external debt stock overtime and prevent an obscuring of the motive behind external debt.

INTRODUCTION

The world is fast becoming a global village, a metaphor that is often invoked to depict global interdependence and the increasing interaction among and the integration of economic activities of human societies around the world (Ajayi, 2001).

In concrete terms, globalization is the intensification of cross-border trade and increased financial and foreign direct investment flows among nations, promoted by rapid advances in and liberalization of communication and information technology (Islam, 1999 and Aninat, 2002).

Thus, globalization conjures the picture of a borderless world with greater economic integration that enhances the living standards of people across the globe.

REFERENCE

Ainabor, A.E, Shuaib I.M, Kadiri, A.K. (2014). Impact of Capital Formation on the Growth of Nigerian Economy 1960-2010: Vector Error Correction Model (VECM), School of Business Studies, Readings in Management and Social Studies, 1(1): 132-154.

Amassoma, D. and Nwosa.P. I. (2011). Investment in Human Capital and Economic Growth in Nigeria: A Causality Approach. Canadian Social Science, 7(4), 114-120.

Baghebo, Mand Edoumiekumo, S (2012). Public Capital Accumulation and Economic Development in Nigeria; 1970-2010. International Journal of Academic Research in Business and Social Sciences; 2(6): 213 – 237

Bakare A.S (2011). A Theoretical Analysis of Capital Formation and Growth in Nigeria. Far East Journal of Psychology and Business; 3(1)

CBN (2016) Quarterly Bulletin; fourth quarter. Abuja, Nigeria

Dauda, R.O. Role of Human Capital in Economic Development: An Empirical Study of Nigerian Case. Oxford: Oxford Businessand Economics Conference Program. 2010.

Comments are closed.

Hey Hi

Don't miss this opportunity

Enter Your Details