IDEAS home Printed from https://ideas.repec.org/a/eaa/aeinde/v10y2010i2_15.html
   My bibliography  Save this article

Foreign Private Investment And Economic Growth In Nigeria

Author

Listed:
  • Tokunbo S. OSINUBI
  • Lloyd A. AMAGHIONYEODIWE

Abstract

Despite the increased flow of investment to developing countries in particular, Sub-Sahara African (SSA) countries, Nigeria inclusive, are still characterized by low per-capita income, high unemployment rates and low and falling growth rates of GDP, problems which foreign private investment are theoretically supposed to solve. The Nigerian government has been focusing on policies that will help attract foreign investors and yet the economy is still dwindling. It is against this background, that this study analyzed the direction and significance of the effect of foreign private investment on economic growth in Nigeria. Secondary data for the period 1970 to 2005 was used for the study. Among the findings was that Foreign Private Investment, Domestic Investment growth and Net Export growth were positively related to economic growth in Nigeria. More so, the Foreign Private Investment, Domestic Investment growth, Net export growth and the lagged error term were statistically significant in explaining variations in Nigeria's economic growth.

Suggested Citation

  • Tokunbo S. OSINUBI & Lloyd A. AMAGHIONYEODIWE, 2010. "Foreign Private Investment And Economic Growth In Nigeria," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 10(2).
    • Handle: RePEc:eaa:aeinde:v:10:y:2010:i:2_15
    as

    Download full text from publisher

    File URL: http://www.usc.es/economet/reviews/aeid10215.pdf
    Download Restriction: No.
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Nikolina Kosteletou & Panagiotis Liargovas, 2000. "Foreign Direct Investment and Real Exchange Rate Interlinkages," Open Economies Review, Springer, vol. 11(2), pages 135-148, April.
    2. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    3. Robert E. Lipsey & Robert C. Feenstra & Carl H. Hahn & George N. Hatsopoulos, 1999. "The Role of Foreign Direct Investment in International Capital Flows," NBER Chapters, in: International Capital Flows, pages 307-362, National Bureau of Economic Research, Inc.
    4. Durham, J.B.J. Benson, 2004. "Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth," European Economic Review, Elsevier, vol. 48(2), pages 285-306, April.
    5. J. Benson Durham, 2003. "Foreign portfolio investment, foreign bank lending, and economic growth," International Finance Discussion Papers 757, Board of Governors of the Federal Reserve System (U.S.).
    6. repec:aer:wpaper:165 is not listed on IDEAS
    7. Marios Obwona, 2001. "Determinants of FDI and their Impact on Economic Growth in Uganda," African Development Review, African Development Bank, vol. 13(1), pages 46-81.
    8. Mikesell, Raymond F & Zinser, James E, 1973. "The Nature of the Savings Function in Developing Countries: A Survey of the Theoretical and Empirical Literature," Journal of Economic Literature, American Economic Association, vol. 11(1), pages 1-26, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Panshak Yohanna, 2013. "Macroeconomic Determinants of Foreign Direct Investment and Economic Transformation in Nigeria, 1981–2010: An Empirical Evidence," Insight on Africa, , vol. 5(1), pages 55-82, January.
    2. Kunofiwa Tsaurai, 2017. "Is foreign Portfolio Equity Investment Inspired Growth Hypothesis Relevant in Emerging Markets?," EuroEconomica, Danubius University of Galati, issue 2(36), pages 78-90, November.
    3. Adekunle, Wasiu & Sulaimon, Mubaraq, 2018. "A Re-examination of the Relationship between Foreign Capital Flows and Economic Growth in Nigeria," MPRA Paper 87754, University Library of Munich, Germany.
    4. Malik, Saif Ullah, 2013. "Role of Foreign Private Investment and Remittance in Stock Market Development: Study of South Asia," MPRA Paper 54530, University Library of Munich, Germany.
    5. Soliu Bidemi Adegboyega & Temidayo Oladiran Akinbobola & Felix O. Ajayi, 2021. "Capital Flows and Economic Growth: What Roles Does Trade Liberialisation Play?," Business & Management Compass, University of Economics Varna, issue 1, pages 26-44.
    6. Alimi, R. Santos & Ibironke, Adesola, 2012. "Dolado - Lütkepohl Causality Tests between Foreign Direct Investment and Economic Growth in Nigeria," MPRA Paper 49277, University Library of Munich, Germany.
    7. Raza, Syed Ali & Sabir, Muhammad Sarwar & Mehboob, Farhan, 2011. "Capital inflows and economic growth in Pakistan," MPRA Paper 36790, University Library of Munich, Germany.
    8. Kayode Oluwadamilare Bankole & Israel O. Ukolobi & Onyuka Felix Mcdubus, 2020. "The Impacts Of Monetary Policies On Savings And Investment In Developing Economies: A Case Study," Working Papers hal-02520027, HAL.
    9. Kodjo N’Souvi & Chen Sun & Badoubatoba Mathieu DISSANI & Folly Dovénam YOVODEVI, 2021. "Impact of Chinese Foreign Direct Investment on the growth of West African Economic and Monetary Union (WAEMU) countries," Journal of Scientific Reports, IJSAB International, vol. 3(1), pages 9-25.
    10. Samuel Adams & Daniel Sakyi & Eric Evans Osei Opoku, 2016. "Capital Inflows and Domestic Investment in Sub-Saharan Africa," Foreign Trade Review, , vol. 51(4), pages 328-343, November.
    11. Courage Mlambo, 2022. "The impact of international portfolio investment on economic growth: the case of selected African states," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 11(10), pages 151-159, December.
    12. Tony Ikechukwu Nwanji & Kerry E. Howell & Sainey Faye & Adegbola Olubukola Otekunrin & Damilola Felix Eluyela & Adedoyin Isola Lawal & Sunday Chinedu Eze, 2020. "Impact of Foreign Direct Investment on the Financial Performance of Listed Deposit Banks in Nigeria," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(2), pages 323-347, April.
    13. Mourao, Paulo Reis, 2018. "What is China seeking from Africa? An analysis of the economic and political determinants of Chinese Outward Foreign Direct Investment based on Stochastic Frontier Models," China Economic Review, Elsevier, vol. 48(C), pages 258-268.
    14. López-Herrera, Francisco & Venegas-Martínez, Francisco, 2014. "Sobre la independencia de los flujos de inversión extranjera de cartera y el crecimiento económico en México [On the independence of foreign portfolio investment flows and economic growth]," MPRA Paper 57550, University Library of Munich, Germany.
    15. Hanna Godlewska-Majkowska & Agnieszka Komor & Magdalena Typa, 2016. "Special Economic Zones as Growth and Anti-growth Poles as Exemplified by Polish Regions," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 4(4), pages 189-212.
    16. Amassoma Ditimi & Azeez Oluwatobiloba, 2020. "Capital Inflows, Financial Deepening And Economic Growth Nexus: The Missing Link," Economic Review: Journal of Economics and Business, University of Tuzla, Faculty of Economics, vol. 18(1), pages 61-73, May.
    17. Acha, Ikechukwu A & Essien, Joseph M, 2018. "The Economic Growth Imperative of Foreign Portfolio Investment for Nigeria," Noble International Journal of Economics and Financial Research, Noble Academic Publsiher, vol. 3(6), pages 71-77, June.
    18. Al Akbari, Salah, 2013. "Proposing Architecture and Process Governance for Risk Mitigation in Organizational Change : a Case Study of the Flight Test and Development Centre (FTC), A Division of the UAE Armed Forces," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/12334 edited by Poix, Michel.
    19. Olufemi Saibu, 2014. "Capital Inflow and Economic Growth Nexus in Nigeria: The Role of Trade Openness," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 6(6), pages 99-113, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Iamsiraroj, Sasi, 2016. "The foreign direct investment–economic growth nexus," International Review of Economics & Finance, Elsevier, vol. 42(C), pages 116-133.
    2. Guariglia, Alessandra & Poncet, Sandra, 2008. "Could financial distortions be no impediment to economic growth after all? Evidence from China," Journal of Comparative Economics, Elsevier, vol. 36(4), pages 633-657, December.
    3. Cristina JUDE & Grégory LEVIEUGE, 2013. "Growth Effect of FDI in Developing Economies: the Role of Institutional Quality," LEO Working Papers / DR LEO 2251, Orleans Economics Laboratory / Laboratoire d'Economie d'Orleans (LEO), University of Orleans.
    4. Manh Vu Le & Terukazu Suruga, 2005. "Foreign direct investment, public expenditure and economic growth: the empirical evidence for the period 1970-2001," Applied Economics Letters, Taylor & Francis Journals, vol. 12(1), pages 45-49.
    5. Anayochukwu Basil Chukwu & Adeolu O. Adewuyi, 2024. "Foreign direct investment, sectoral output performance and poverty in Africa: Evidence from panel structural vector autoregressive and threshold regression models," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 29(3), pages 2665-2698, July.
    6. Thomas M. Steger, 2000. "Productive Consumption and Growth in Developing Countries," Review of Development Economics, Wiley Blackwell, vol. 4(3), pages 365-375, October.
    7. Gui-Diby, Steve Loris, 2014. "Impact of foreign direct investments on economic growth in Africa: Evidence from three decades of panel data analyses," Research in Economics, Elsevier, vol. 68(3), pages 248-256.
    8. Kottaridi, Constantina & Stengos, Thanasis, 2010. "Foreign direct investment, human capital and non-linearities in economic growth," Journal of Macroeconomics, Elsevier, vol. 32(3), pages 858-871, September.
    9. Sin-Yu Ho & Bernard Njindan Iyke, 2020. "The Determinants of Economic Growth in Ghana: New Empirical Evidence," Global Business Review, International Management Institute, vol. 21(3), pages 626-644, June.
    10. Kunieda, Takuma & Okada, Keisuke & Shibata, Akihisa, 2011. "Corruption, Globalization, and Economic Growth: Theory and Evidence," MPRA Paper 35355, University Library of Munich, Germany.
    11. Narayan, Seema & Narayan, Paresh Kumar & Mishra, Sagarika, 2010. "Investigating the relationship between health and economic growth: Empirical evidence from a panel of 5 Asian countries," Journal of Asian Economics, Elsevier, vol. 21(4), pages 404-411, August.
    12. Christer Ljungwall & Junjie Li, 2007. "Financial Sector Development, FDI and Economic Growth in China," Finance Working Papers 22026, East Asian Bureau of Economic Research.
    13. Ghosh Madanmohan & Wang Weimin, 2010. "Does FDI Accelerate Economic Growth? The OECD Experience Based on Panel Data Estimates for the Period 1980-2004," Global Economy Journal, De Gruyter, vol. 9(4), pages 1-23, January.
    14. Burcu Turkcan & I. Hakan Yetkiner, 2010. "Endogenous determination of FDI growth and economic growth: the OECD case," International Journal of Public Policy, Inderscience Enterprises Ltd, vol. 5(4), pages 409-429.
    15. Beugelsdijk, Sjoerd & Smeets, Roger & Zwinkels, Remco, 2008. "The impact of horizontal and vertical FDI on host's country economic growth," International Business Review, Elsevier, vol. 17(4), pages 452-472, August.
    16. Anayochukwu Basil Chukwu & Adeolu O. Adewuyi & Adebowale M. Adeleke & Banji B. Awodumi & Tobechi F. Agbanike, 2022. "Modelling composition of growth, FDI and welfare in Africa: a SEM approach," Economic Change and Restructuring, Springer, vol. 55(4), pages 2445-2478, November.
    17. Zaiter Lahimer, Mahjouba, 2011. "L’impact des entrées de capitaux privés sur la croissance économique dans les pays en développement," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/7670 edited by Sterdyniak, Henri.
    18. Awolusi D. Olawumi, 2019. "Human Capital Development and Economic Growth in BRICS Countries: Controlling for Country Differences," Journal of Economics and Behavioral Studies, AMH International, vol. 11(4), pages 1-17.
    19. Laura Alfaro & Areendam Chanda & Sebnem Kalemli-Ozcan & Selin Sayek, 2006. "How Does Foreign Direct Investment Promote Economic Growth? Exploring the Effects of Financial Markets on Linkages," DEGIT Conference Papers c011_023, DEGIT, Dynamics, Economic Growth, and International Trade.
    20. Hatem Altaee, 2018. "Trade Openness and Economic Growth in the GCC Countries: A Panel Data Analysis Approach," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 11(3), pages 57-64, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eaa:aeinde:v:10:y:2010:i:2_15. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: M. Carmen Guisan (email available below). General contact details of provider: http://www.usc.es/economet/eaa.htm .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.