DEPARTMENT OF ECONOMICS

This study investigates the impact of foreign direct investment (FDI) on economic growth in Nigeria from 1981 to 2023, employing the Autoregressive Distributed Lag (ARDL) modeling approach. The study incorporates GDP growth rate as the dependent variable and FDI, interest rate, exchange rate, and inflation rate as explanatory variables. Descriptive statistics reveal moderate variability among the variables, while correlation analysis indicates a positive association between GDP growth and FDI, and a negative relationship with inflation. Unit root tests confirm that all variables are stationary at first difference, satisfying the preconditions for ARDL estimation. The ARDL bounds test results establish the existence of a long-run equilibrium relationship among the variables. Short-run dynamics show that FDI has both positive and negative effects on GDP growth across lags, suggesting that the impact of investment inflows is time-dependent. Exchange rate depreciation exerts a significant negative influence on economic growth, while inflation exhibits mixed effects depending on lag structure. The long-run estimates reveal that FDI, interest rate, exchange rate, and inflation have negative but statistically insignificant impacts on GDP growth, implying limited long-term contribution to growth within the study period. Diagnostic tests confirm the absence of heteroskedasticity and autocorrelation, validating the robustness of the model. The study concludes that FDI, though influential in the short run, does not significantly drive long-term growth unless supported by stable macroeconomic conditions. It recommends that policymakers enhance the investment climate, ensure exchange rate stability, and implement consistent macroeconomic policies to attract productive FDI and sustain economic growth in Nigeria.

This study investigates the relationship between public debt and economic growth in Nigeria from 1980 to 2022, focusing on GDP dynamics, inflation, exchange rates, and institutional factors. Against the backdrop of Nigeria’s rising debt-to-GDP ratio—projected to exceed 46% by 2025—the research addresses conflicting theoretical debates on whether public debt stimulates growth through investments or stifles it via fiscal instability. Employing a mixed-methods approach, the study combines quantitative analysis of time-series data (sourced from the IMF, World Bank, and Central Bank of Nigeria) with qualitative insights from policy documents. Econometric techniques, including OLS regression, ADF unit root tests, and Johansen cointegration analysis, are applied to evaluate the impact of debt on macroeconomic performance.
Results indicate a significant positive relationship between total public debt and GDP growth, suggesting that strategic borrowing for infrastructure and human capital development can enhance economic outcomes. The study concludes that sustainable debt management requires institutional reforms, diversified revenue streams, and transparent allocation of borrowed funds. These findings offer actionable insights for policymakers seeking to balance debt-driven growth with long-term fiscal stability in resource-dependent economies.

This study investigates the impact of financial efficiency on Nigeria’s economic performance, focusing on economic growth, price instability (inflation), and trade balance. The research is anchored on the theories of financial intermediation and endogenous growth, which emphasize the role of efficient financial systems and capital accumulation in driving economic development. Employing the Autoregressive Distributed Lag (ARDL) approach to accommodate the mixed order of integration of the variables, the study estimates three models to assess both short-run and long-run effects. The findings reveal that financial efficiency does not have a statistically significant impact on economic growth or inflation control, contrary to many previous studies. However, financial efficiency demonstrates a significant short-run effect on stabilizing the trade balance.These results suggest that structural and institutional weaknesses, along with human capital challenges, limit the ability of financial efficiency to foster sustained economic improvements in Nigeria. The study concludes that financial sector reforms must be integrated with broader institutional and macroeconomic policies to enhance economic performance and sustainable development.