Financial Structure and economic growth: empirical evidence from Nigeria

Saibu, Olufemi; Bowale, Kayode Ebenezer; Akinlo, Anthony Enisan

doi:10.1504/ijbem.2009.023446

Cited by 11 publications

(12 citation statements)

References 27 publications

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“…The results showed that despite the non-significant influence of bank-based theory and legal-based theory, both have positive effect in promoting economic growth while the result shows further that market-based theory and the financial service theory were non-significant but exhibited negative influence in promoting economic growth. These results are consistent with Saibu, Bowale and Akinlo (2009) findings. Also, Olofin and Afangideh (2009) investigated the role of financial structure in economic development in Nigeria using aggregate annual data from 1970 to 2005.…”

Section: Review Of Literaturesupporting

confidence: 93%

“…Thus, one of such possible inputs is the financial resources committed into production process. In line with this argument, capital can be decomposed into fixed physical (K p ) and, financial (K f ) resources which are generated from the financial sector (Saibu et al, 2009). Thus:…”

Section: Analytical Frameworkmentioning

confidence: 99%

“…Summarily, the World Bank ( 2001) reached a conclusion that the evidence should be interpreted as clearly suggesting that both the development of bank-based and market-based financial systems promote economic growth and, each can complement the other. Furthermore, Saibu, Bowale and Akinlo (2009) investigated the relationship between economic growth and financial structure, i.e.,the degree to which an emerging economy is market based or bank based. In particular, this study empirically assessed the competing theoretical views of financial structure and economic growth dynamics in Nigeria using vector error correction model over a 30 year period.…”

Section: Review Of Literaturementioning

confidence: 99%

“…The model of the study differs from Saibu et al, ( 2009) with little modification in area of the determinant variables. This study incorporated into the model total government expenditure and gross fixed capital formation as against public investment on infrastructure and gross private investment in Saibu et al, (2009). In line with the objectives of the study which is investigating the competing views on the role of the financial structures (bank-based view, market-based view, financial service view and the legal system service view) in promoting economic growth in Nigeria, equation ( 3) is modified.…”

Section: Analytical Frameworkmentioning

confidence: 99%

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Financial Structure and Economic Growth: The Nigerian Experience, 1980-2017

Nkoro

Uko

2019

aesr

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This study investigated the role of financial structure in explaining economic growth dynamics in Nigeria using annual time series from 1981-2017. The study employed the vector error correction model (VECM) in the analysis of the data. As lead up to financial structure and economic growth relationship analysis, the competing theoretical views of bank and market based financial system and economic growth were explored. The result of the study showed that economic growth, financial development variables and the underlying control variables are cointegrated. The result of the economic growth effect of financial development showed that stock market and bank-based have a significant effect on growth. This implies that both bank-based and market-based matter in explaining economic growth dynamics. On the relationship between financial structure and economic growth, the study revealed that economic growth, financial structure and the underlying control variables have a long run relationship. The study also revealed that financial structure which captures the combination of stock market-based and bank-based has a positive significant effect on growth. A significant coefficient of financial structure implies that financial structure matters in explaining growth. Therefore, the study posits that the overall financial structure is the most useful way to assess the financial systems since both bank and stock market system matter in explaining economic growth as against bank-based versus market-based debate. Based on the empirical evidence, the study therefore recommends that there should be continuous holistic reforms of both banking and stock market simultaneously, as the development in one sector has a neglect effect on the other.

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Section: Review Of Literaturesupporting

confidence: 93%

Section: Analytical Frameworkmentioning

confidence: 99%

Section: Review Of Literaturementioning

confidence: 99%

Section: Analytical Frameworkmentioning

confidence: 99%

See 2 more Smart Citations

Financial Structure and Economic Growth: The Nigerian Experience, 1980-2017

Nkoro

Uko

2019

aesr

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“…A number of studies have shown positives relationships between Nigerian stock exchange and growth in the Nigerian economy (Adefeso et al, 2013;Kolapo & Adaramola, 2012;Osinubi, 2002;Adenuga, 2010;Saibu & Bowale, 2009;Ogunmuyiwa, 2010;Nuruddeen, 2009;Mohtadi & Agarwal, 2001). Other studies have casted doubt on the positive contribution of the Nigerian stock exchange on economic growth (Henry & Olabanji, 2013;Adigwe et al, 2015).…”

Section: )mentioning

confidence: 99%

Measuring Co-Movements and Linkages between Nigeria and the UAE Stock Exchanges: Is there Opportunity for Portfolio Building?

Abdullahi

2020

JAREAS

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Purpose: The main objective of this study is to examine the relationship between Nigerian Stock Exchange and Dubai stock exchange with the aim of finding out the direction of movements between their respective indices. Approach/Methodology/Design: The methodology adopted for the analysis is ARDL cointegration model and the Generalized Method of Moment (GMM). This is because of their known efficiency in detecting patterns between variables. Findings: The result of the short-run analysis using GMM shows that there is existence of short-run causality between the Dubai financial market (DFM) and the Nigerian stock exchange (NSE). Thus, for investors looking for short- run arbitrage opportunity between the markets, they shall look elsewhere. But, the result of bound testing has shown lack of cointegration between the two markets. This is a sign of existence of opportunities for portfolio diversification between Nigeria stock exchange and Dubai financial market, since the two markets are not cointegrated in the long-run. Practical Implications: The study helps bridge the empirical literature gap in stock market integration and portfolio diversification with reference to the Nigeria and UAE. It will, therefore, guide local and foreign investors with interest in Nigeria and UAE Stock Exchanges. It will also guide Nigerian and UAE policy makers to understand the market better, especially as it concerns financial contagion. Originality/value: This study provides further evidence on stock market integration in emerging markets. New researches shall adopt different methodology such as use of volatility tracking models to measure volatility linkage between the markets.

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The finance–growth nexus in the Middle East and Africa: A comparative meta‐analysis

Anwar

Iwasaki

2022

Int. J Fin Econ

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By taking 1417 estimates from 96 studies and applying advanced meta‐analysis techniques, this study compares the effect size of financial development (FD) and liberalization on economic growth in the Middle East and Africa. We find that the overall finance–growth nexus is positive, yet its effect size differs across regions. Indeed, finance has a larger growth‐enhancing effect in the sub‐Saharan Africa (SSA) region than in the Middle East and North Africa region. This finding is supported by meta‐regression analysis that controls for various study conditions simultaneously. Moreover, we uncovered that the extracted estimates contain evidence of the true effect size of FD and liberalization on growth in the extant literature and SSA studies.

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Financial Structure and economic growth: empirical evidence from Nigeria

Cited by 11 publications

References 27 publications

Financial Structure and Economic Growth: The Nigerian Experience, 1980-2017

Financial Structure and Economic Growth: The Nigerian Experience, 1980-2017

Measuring Co-Movements and Linkages between Nigeria and the UAE Stock Exchanges: Is there Opportunity for Portfolio Building?

The finance–growth nexus in the Middle East and Africa: A comparative meta‐analysis

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