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Examining the Relative Roles of Domestic and Foreign Direct Investments in Nigeria

Author

Listed:
  • Evans S. Osabuohien

    (Department of Economics and Development Studies, Covenant University, Ota, Nigeria,)

  • Ayobami O. Soogun

    (Department of Economics and Development Studies, Covenant University, Ota, Nigeria)

  • Ese Urhie

    (Department of Economics and Development Studies, Covenant University, Ota, Nigeria,)

Abstract

This study examines the relative relevance of domestic investment (DI) and foreign direct investment (FDI) on economic performance in Nigeria (1980-2014). In an attempt to achieve this broad objective, annual time series data sourced from the Central Bank of Nigeria's Statistical Bulletin, which was estimated using vector error correction technique, among others. The results, inter alia, show that both DI and FDI had significant effect on Nigeria's economic performance; however, the influence of the former was observed to be far greater than the latter with marked difference both in terms of the level of significance and size. Thus, the study recommends, among others, the need for government to create the ambience that will enable domestic investors to thrive, on one hand, and be complemented by foreign investment, on the other.

Suggested Citation

  • Evans S. Osabuohien & Ayobami O. Soogun & Ese Urhie, 2017. "Examining the Relative Roles of Domestic and Foreign Direct Investments in Nigeria," International Journal of Economics and Financial Issues, Econjournals, vol. 7(4), pages 365-371.
    • Handle: RePEc:eco:journ1:2017-04-46
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    References listed on IDEAS

    as
    1. Asiedu, Elizabeth, 2002. "On the Determinants of Foreign Direct Investment to Developing Countries: Is Africa Different?," World Development, Elsevier, vol. 30(1), pages 107-119, January.
    2. Osuagwu, Eze Simpson & Nwokoma, Ndubisi, 2017. "Empirical assessment of the competitive conduct of Nigerian banks in a post-consolidation era," Research in International Business and Finance, Elsevier, vol. 41(C), pages 412-422.
    3. Perekunah Eregha, 2012. "The Dynamic Linkages between Foreign Direct Investment and Domestic Investment in ECOWAS Countries: A Panel Cointegration Analysis," African Development Review, African Development Bank, vol. 24(3), pages 208-220.
    4. Evans Stephen Osabuohien & Uchenna Rapuluchukwu Efobi, 2013. "Africa's Money in Africa," South African Journal of Economics, Economic Society of South Africa, vol. 81(2), pages 292-306, June.
    5. Anisa Shamim & Pervaiz Azeem & Syed M. Muddassir Abbas Naqvi, 2014. "Impact of Foreign Direct Investment on Poverty Reduction in Pakistan," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(10), pages 465-490, October.
    6. Amassoma Ditimi & Ogbuagu Matthew I., 2015. "FDI, private investment and public investment in Nigeria: An unravelled dynamic relation," Journal of Economic and Financial Studies (JEFS), LAR Center Press, vol. 3(5), pages 10-18, October.
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    2. Nur Feriyanto, 2020. "Economic and Tourism Factors Affecting the Real Gross Regional Domestic Product: A Case Study," European Research Studies Journal, European Research Studies Journal, vol. 0(3), pages 736-756.

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    More about this item

    Keywords

    Domestic Investment; Foreign Direct Investment; Economic Performance; Vector Error Correction Model;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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