Their result revealed that foreign direct investment had significant impact on economic growth in nigeria. Impact of foreign trade, fdi, exchange rate and inflation. This study investigates how inflation and interest rates are related to economic growth of india. In addition, the impact of fdi on economic growth is more. In addition, the impact of fdi on economic growth is more contentious in empirical than theoretical studies, hence the need to examine the relationship between fdi and growth in different economic dispensations. This page provides nigeria gdp annual growth rate actual values, historical data, forecast, chart, statistics, economic. A dynamic panel threshold analysis for asian economies. It examined the dependency of economic growth on foreign trade, exchange rate, inflation and foreign direct investment. This might be attributed to the omission of the role of capital stock and labor in the tradegrowth nexus. Ayashagba and abachi 2002 investigate on the effects of foreign direct investment on economic growth from 1980 to 1997. Nov 08, 2016 a growth model via the ordinary least square method was used to ascertain the relationship between fdi and economic growth in nigeria. At moderate rates of inflation, between the two threshold levels, the effect of inflation is found to be negative and significant, and at high rates of inflation, above the second threshold, the marginal impact of additional inflation on economic growth diminishes but is still significantly negative.
Pdf the paper investigated foreign direct investment impact on economic growth in nigeria using annual data for 1981 to 2016, from cbn statistical. However, when accounting for the different average. The study examined the impact of government expenditure on economic growth in nigeria, using the time frame 20002015 5 years. Based on the above, this research examines the influence of inflation and interest rates on indias economic growth. As a result of the study was found out that nigerian authorities should set interest rate policies that will boost the economic growth. The effect of inflation and interest rate on economy growth in nigeria is quite a serious problem. Using a structural vector auto regression svar model, the paper explores the relationships between the monetary policy rate interest rate, growth rate of money supply, inflation, exchange rate growth and growth rate of output. The empirical result of the test showed that for the. Ordinary least square method and ttest was used to test the variables most likely to impact on economic growth in nigeria due to inflation. The need to draw foreign capital in nondebt constituting ways is one of the reasons emerging economies wish to encourage foreign investments. Motivated by this controversial, this study examined the impact of inflation on economic growth and established the existence of inflation growth relationship. An empirical study based on botswana international journal of research in business studies and management v2 i9 september 2015 agency, 20.
Pdf the effect of exchange rate and inflation on foreign. This study therefore examines the major economic growth determinants as well as the direction of causality that exists between economic growth and some selected economic growth indicators in nigeria, employing the johansen cointegration and granger causality tests. Impact of foreign direct investment and trade on economic growth. The impact of foreign investments on domestic inflation in nigeria. Impact of inflation on nigeria economic growth mensch mind. The country experiences on inflation is no longer the problem but the fact that inflation problem seems to have reached the crisis dimension. Threshold effect of inflation on economic growth in nigeria. In order to examine the impact of inflation on economic growth, the study has used the time series data for the period 19802012. Nigeria gdp annual growth rate 19822019 data 20202022. An analytical study of the impact of inflation on economic growth in. Pwc estimates that nigeria would need an investment rate of at least 26% of gdp to achieve a growth of 7%.
The effects of inflation on economic growth and on its. They found that savings and economic growth is cointegrated and positively related in the long run so the study indicates savings is an engine to economic growth through its impact on capital formation. The main objective of the study was to investigate the nature of relationship between inflation rate and economic growth rate. In the aggregate level, fdi is observed to have a positive effect on economic growth. While some researchers suggest a positive effect, others found a negative effect. Various macroeconomic policies notably fiscal, monetary and exchange rate had from time to time been adopted to address this problem of inflation. These perceived problems are being claimed to have caused a fast decline in the economic growth of nigeria. Effect of inflation on the growth and development of the nigerian economy an. There is the further problem of endogeneity, which has not been consciously tackled in previous studies in nigeria. Pdf impact of foreign direct investment on economic growth. Firstly, the impact of the inflation rate on economic growth with the possibility of two. Orji, ogbuabor and anthonyorji 2015 as well as obamuyi and olaeranfemi 2011 concluded that financial reforms including interest rate liberalisation have a positive impact on economic growth in nigeria. Statistical bulletin, annual reports and statement of accounts.
Such problems include high unemployment rate, low investment, high rate of inflation and unstable foreign exchange rate. Threshold effects of inflation on economic growth in africa african. Impact of interest rate on economic growth in nigeria. Promoting economic growth in nigeria using time series analysis believed that the impact of monetary policy could be analyzed in terms of the behaviours of the intermediate targets of consumer price index and inflation rate in promoting economic growth in nigeria. Impact of foreign trade, fdi, exchange rate and inflation on. The main type of data used in this study is secondary. Effect of foreign direct investment on economic growth in.
Impact of foreign direct investment on nigeria economic growth. Kenya, tanzania and nigeria has moderate inflation and low growth. The different economic theories state that inflation and interest rates are associated with economic growth based on economic conditions of the nation. Hence, these studies actually modeled the influence of natural resources on nigerias economic growth. The impact of foreign investments on domestic inflation in. In the case of cambodia, seng sothan 2014 investigated the causality between domestic savings and economic growth.
Impact of inflation on economic growth of nigeria 2011q1 2015q3 also available for 1981 20 project proposal. A disaggregated analysis igwemeka ebele okafor department of banking and finance university of nigeria enugu campus. Pdf impact of foreign direct investment on economic. Impact of foreign direct investment on nigeria economic.
Impact of inflation on nigeria economic growth 19812016. The impact of government spending on economic growth. The impact of monetary policy on the economic growth of nigeria. Abstractcurrently, economists seem to agree that high rates of inflation cause a. Effect of inflation on the growth and development of the. The study examined the impact of inflation rate on the economic growth in nigeria. The relationship between trade openness and economic growth has been extensively investigated yielding to mixed and inconclusive results. It is against this backdrop that this study examined the effect of foreign direct investment on economic growth in nigeria. Investment and economic growth in nigeria abdulmumini baba alfa tukur garba, ph.
The impact of monetary policy on the economic growth of. Impact of foreign direct investment on economic growth in. Impact of inflation rate on the economic growth in nigeria. This study investigated the impact of inflation on economic growth and established the existence of inflation growth relationship in the context of south asian countries. Impact of foreign direct investment and trade on economic growth foreign direct investment fdi and trade are often seen as important catalysts for economic growth in the developing countries. In recent years, all her efforts to grow the economy, nigerias rate of economic growth has remained very volatile and sluggish. Ilan, 2007 investigates the impact of foreign direct investment fdi on economic growth using detailed sectoral data for fdi inflows to indonesia over the period 19972006. More specifically, the study sought to assess government expenditure and economic growth. A growth model via the ordinary least square method was used to ascertain the relationship between fdi and economic growth in nigeria. Monetarism reemphasised the critical role of monetary growth in determining inflation, while neoclassical and endogenous growth theories sought to account for the effects of inflation on growth through its impact on investment and capital accumulation. The effects of inflation on economic growth and on its macroeconomic determinants.
This study is on the effect of exchange rate and inflation on foreign direct investment and its relationship with economic growth. Policymakers are divided as to whether government expansion helps or hinders economic growth. The result found that the interest rate has a slight impact on growth. Effect of inflation on the growth and development of the nigerian. There have been controversies regarding the effect of foreign direct investment on the growth of the host countrys economy. The study analyzed the impact of foreign direct investment on nigeria economic growth over the period of 1999 20.
Pdf threshold effect of inflation on economic growth in nigeria. This study investigated the impact of inflation on investment and economic growth in nigeria. Although most works were based on the impact of fdi on economic growth, ayanwale, 2007. A growth model therefore, is a functional economic relationship in which the growth rate of gross domestic product g depends directly on the national net savings rate s and inversely. Abstract this paper investigates the impact of inflation on economic growth and development in nigeria between 1970. This study is on inflation rate and economic growth in nigeria between the period 1980 and 20. The impact of government spending on economic growth by daniel j. Inflation discourages savings and investment, it favours debtors at the expense of. The impact of foreign direct investment on the nigerian.
Investment, inflation and economic growth semantic scholar. Statement of the problem the main purpose of this study is to try to identify the impact of interest rate of economic growth. The effects of inflation on economic growth and on its macroeconomic determinants muhammad khan to cite this version. This study analysed the long run relationship between economic growth, foreign direct investment, foreign trade, inflation, exchange rate, imports and exports for the period of 19802011 using annual time series analysis. The study explored secondary data for the period of 1960 to 2012 and used eview 7. However, much less agreement exists about the precise relationship between inflation and economic performance, and the mechanism by which inflation affects economic activity. Download the project from chapter one to five with reference. How inflation and interest rates are related to economic. Anono abdulrahman zubairu lecturer department of management technology school of management and information technology modibbo adama university of technology,yola,adamawa state, nigeria.
Anono abdulrahman zubairu lecturer department of management technology school of management and information technology modibbo adama university of technology,yola,adamawa state,nigeria. The effect of exchange rate and inflation on foreign direct investment and its relationship with economic growth in nigeria article pdf available march 2011 with 8,997 reads how we measure. The study made use of secondary data sourced from the central bank of nigeria cbn statistical bulletin and the national. Sectoral composition of fdi in nigeria, 19702001 percentage 12 4. Since nigerian financial sector liberalization is anchored on. The study will examine the impact of interest rate as one of the main variables that affects economic growth in nigeria jelilov, gylych. Fdi is an important vehicle of technology transfer from developed countries to developing countries. The relationship between domestic investment and economic.
Mrs dhanya jagadeesh the impact of savings on economic growth. In order to have a clear understanding about relationship between inflation and economic growth from 1995 to 2010 on ssa countries, the investigator uses the following graph. Using time series data spanning forty one years 19702011 which was obtained from the central bank of nigeria cbn statistical bulletin volume 22, and central bank of nigeria. Background of the study the word inflation rings a bell in the market economics of the world. In nigeria, one of the major problem facing the economy is inflation, the country registered low inflation in the years immediately after independence.
The study was conducted to evaluate the impact of inflation on economic growth in the context of an emerging market using empirical evidence from nigeria. Timeseries data for the period 1990 2011 were used to examine the impact of inflation on economic growth. Impact of foreign direct investment and trade on economic. Nov 02, 2016 there have been controversies regarding the effect of foreign direct investment on the growth of the host countrys economy.
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