FINANCIAL MARKET FUNDS AND ECONOMIC PERFORMANCE IN NIGERIA
Keywords:
Government securities, equity, credit to private sector ,Economic performance
Abstract
This study aims to evaluate the interrelationships among financial market funds and Nigeria's gross domestic product. specifically, the study examined how government securities, credit to private sector and equities influence gross domestic product. data utilized in the study were sourced from the Central Bank of Nigeria statistical bulletin of various issues. The study employed the descriptive statistics, unit root test, Johansen co-integration, error correction model, and Granger causality techniques at the 5% significance level.The study discovered that all the variables were integrated at first differencing; thus, necessitating the Johansen co-integration that validates the presence of long-run form. The result of the error correction model showed that credit to private sector was positive and significant to gross domestic product, equity was positive but insignificantly related to gross domestic product, and government securities had negative and insignificant relationship with to gross domestic product in Nigeria. For Granger causality, there was the presence of uni-directional movement from to gross domestic product to each of the independent variables in the study. The study concluded that commercial paper was the most significant aspect of financial market funds that promotes economic growth in Nigeria. The study recommended that government should ensure that funds made available for a particular project are directed to that project and should be fully accounted for by the monitoring team.
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References
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Claus, l., & Grimes, A. (2003).Asymmetric information, financial intermediation and monetary transmission n mechanism: A critical review. New Zealand treasury working paper, 03(19),1-28.
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Garcia, V. F., & Liu, L. (1999). Macroeconomic determinants of stock market development. Journal of Applied Economics,11(1),29-59.
Gali, J. (2008). Monetary policy, inflation and business cycle: An introduction to the New Keynesian Framework. Oxfordshire: Princeton University Press.
Granger, C. J. (1981). Some properties of time series data and their use in econometric model specification. Journal of Econometrics, 16. 121-30.
Greenwood, J., & Smith, B. D. (1997). Financial markets in development, and the development of financial markets. Journal of Economic Dynamics and Control ,21, 145-181.
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Ighoroje, J. S., & Osevwe-Okoroyibo, E. E. (2022). Financial market operations and economic growth of Nigeria: An Empirical Insight. African Journal of Accounting and Financial Research, 5(2), 13-31.
Kizito, E. U. (2012). The place of financial markets in the development process: Evidence from Nigeria. Journal of Economics and Behavioural Studies 4(11), 649-659.
Madume, W., C., Okereke, E.J., & Nwulu, S., O. (2023). Analysis of financial markets and performance of Nigerian economy . Asian Journal of Economics, Finance and Management, 5(1), 131-140.
McKinnon, R. I. (1973) .Money and Capital in Economic Development. Washington, D. C. Brooking Institutions.
Marinkovic, S., & Radovic, O. (2013). Stock market development and economic growth (The Case study of Belgrade Stock Exchange). Actual Problems of Economics, 143(5), 399- 408.
Mankiw, G.N. and Taylor, M.P. (2007). Macroeconomics. (European Edition ed.) Basingstoke: Palgrave Macmillan.
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Nnamdi, I. S. (2015). Private vs public sector bank credits and economic growth nexus in Nigeria: Where Does Efficacy Rest? Research Journal of Finance and Accounting ,6(3),226-237.
Nnamdi, I. S. (2015). Financial market funds and economic growth nexus in Nigeria: A co- integration perspectives with lessons. European journal of business and management, 7(2), 191-202.
Ndudi, F. E., Olannye, A. A., & Iyamahbor, M. (2020). Capital market as a catalyst for economic growth: Nigeria in Perspective. Palarch’s Journal of Archaeology of Egypt/Egyptology .17(7),13123-13140.
North, D. C. (1981).Structure and change in economic history. (W.W. Norton, New York, NY).
Nwankwo, S. N., & Agbo, E. I. (2021). Financial markets efficiency and Nigeria economic development . Saudi Journal of Economics and Finance, 5(02), 859-865.
Obi, C. O. (2021). Money market instruments and economic growth of Nigeria. European Journal of Management and Marketing Studies, 6(2),150-166.
Odetayo, T. A., & Sajuyigbe, A. S. (2012). Impact of Nigerian capital market on economic growth and development. International Journal of Arts and Commerce, 1(5), 1-8.
Odunga, R., & Ayoyi, I. R. (2016). Impact of financial markets on the economic growth of east Africa. European Journal of Logistics, Purchasing and Supply Chain Management, 4(5), 25-33.
Okolie, J. I., & Okolie, D. O. (2022). Financial market, monetary policy and economic growth: Evidence from Nigeria. IIARD International Journal of Economics and Business Management (IJEBM), 8(2), 77-89.
Ogunsanwo, O. F., Adelugba, I. A., & Efuntade, A. O. (2023). Effects of financial market intermediation on economic growth in Nigeria. The Journal of Developing Areas, 57(2),52-64.
Olulu-Briggs, O. V. (2021). Money and capital market investments on economic performance in Nigeria: A Revisit. IOSR Journal of Economics and Finance. 12(2), 9-15.
Ologunwa, O. P., & Sadibo, O. V. (2016). Capital market development and economic growth in Nigeria: an empirical analysis. FUTA Journal of Management and Technology, Doi: 1.1/fjmt.2016/v1n1p5,48-59.
Osakwe, C. I., & Akunna, R. C. (2022). Private sector credit and Nigeria economic growth (1994-2019). International Journal of Multidisciplinary and Current Educational Research (IJMCER), 4(1), 308-315.
Oluwatosin, E. O., Adekanya T., & Yusuf, S. A. (2013). Empirical analysis of the impact of capital efficiency on economic growth and development in Nigeria. International Journal of Academic Research in Economics and Management Sciences, 2(6) 44-53.
Oluwatosin, E. O., Adekanya T., & Yusuf, S. A. (2013). Empirical analysis of the impact of capital efficiency on economic growth and development in Nigeria. International Journal of Academic Research in Economics and Management Sciences, 2(6) 44-53.
Oyintonefie, E. (2023). Analysis of financial markets and performance of Nigerian economy. EPRA International Journal of Socio-Economic and Environmental Outlook, 10(8), 35-44.
Shaw, E. S. (1976). Financial repression and liberalization, in Meier, G.M.(ed), Leading Issues in Economic Development, New York, Oxford University Press.
Shaw, E. S. (1973).Financial deepening in economic development. New York Oxford University Press.
Patrick, H. T. (1976). Demand following or supplying leading finance, in Meier, G.M.(ed):Leading Issues in economic development .Oxford University Press.
Ukpabi, I. O., Eleje, E., C., & Onu, C. (2021). Private sector credit and economic growth in Nigeria: A Model of ARDL Bounds Test. Journal of Emerging Technologies and Innovative Research, 8(12),45-55.
Ughulu, S. E., & Osas, A. M. (2020). Capital market operations and economic growth in Nigeria: An Empirical Verification. International Journal of Advanced Engineering and Management Research, 5(3), 1-18.
World Bank (2022).World bank lead economist for Nigeria and co-author report.
Abayomi, Y. A., & Yakubu, U. A. (2022). Impact of the capital market on the Nigerian economic growth. International Journal of Research and Innovation in Social Science (IJRISS), 6(6), 13-19.
Aigheyisi, O. S. (2016). Does stock market development play any role in the effect of FDI on economic growth in Nigeria? An empirical investigation. Oradea Journal of Business and Economics, 1(2), 51-61.
Amali, E., Alymkulova, N., & Ejila, S. A. (2023). Banks' credit to the private sector and economic growth in Nigeria: the Moderating Role Of Digitalization .Journal of Global Economics and Business, 4(13), 17-35 .
Angaye, P. E. G., & Bingilar, P. F. (2020). Capital market development and economic growth in Nigeria. American International Journal of Business Management, 3(7), 58–63. https://www.aijbm.com
Awe, O. O. (2012). On pair wise granger causality modeling and econometric analysis of selected economic indicators .Iinterstatst Journals.net/YEAR/2012/articles/1208002.pdf. 1-17.
Baghebo, M. P.,& Warlice, J. U.(2021).Financial market and the real economy in Nigeria. Journal of Research and Development Studies 5(1), 12 – 28.
Branch, S. Cooper, Y., & Moxey, M. (2016). An empirical analysis of the nexus between private sector credit, economic growth, government expenditure, interest rate and inflation: Case of the Bahamas (1989-2014).Central Bank of Bahamas .1-19.
Brooks, C. (2009). Introductory Econometrics for Finance, Cambridge, University press.318-375.
Chami, R., Fullenkamp, C., & Sharma, S. (2009). A framework for financial market development. International Monetary Fund Working Paper, 09/156.
Camba, J. A. C., & Camba, A. L. (2020). The dynamic relationship of domestic credit and stock market liquidity on the economic growth of the Philippines. The Journal of Asian Finance, Economics and Business, 7(1), 37-46.
Claus, l., & Grimes, A. (2003).Asymmetric information, financial intermediation and monetary transmission n mechanism: A critical review. New Zealand treasury working paper, 03(19),1-28.
Ebi, O. R., & Omoijahe, D. O. (2021). Predicting Nigeria’s economic growth through the financial markets: A comparative analysis. European modern Studies Journal, 5(6), 503-520.
Garcia, V. F., & Liu, L. (1999). Macroeconomic determinants of stock market development. Journal of Applied Economics,11(1),29-59.
Gali, J. (2008). Monetary policy, inflation and business cycle: An introduction to the New Keynesian Framework. Oxfordshire: Princeton University Press.
Granger, C. J. (1981). Some properties of time series data and their use in econometric model specification. Journal of Econometrics, 16. 121-30.
Greenwood, J., & Smith, B. D. (1997). Financial markets in development, and the development of financial markets. Journal of Economic Dynamics and Control ,21, 145-181.
Goldsmith, R. W. (1969) .Financial Structure and Development. New Haven Yale University Press.
Ighoroje, J. S., & Osevwe-Okoroyibo, E. E. (2022). Financial market operations and economic growth of Nigeria: An Empirical Insight. African Journal of Accounting and Financial Research, 5(2), 13-31.
Kizito, E. U. (2012). The place of financial markets in the development process: Evidence from Nigeria. Journal of Economics and Behavioural Studies 4(11), 649-659.
Madume, W., C., Okereke, E.J., & Nwulu, S., O. (2023). Analysis of financial markets and performance of Nigerian economy . Asian Journal of Economics, Finance and Management, 5(1), 131-140.
McKinnon, R. I. (1973) .Money and Capital in Economic Development. Washington, D. C. Brooking Institutions.
Marinkovic, S., & Radovic, O. (2013). Stock market development and economic growth (The Case study of Belgrade Stock Exchange). Actual Problems of Economics, 143(5), 399- 408.
Mankiw, G.N. and Taylor, M.P. (2007). Macroeconomics. (European Edition ed.) Basingstoke: Palgrave Macmillan.
Nnamdi, l. S., Umar, M. E., & Omotayo, A. F. (2017). Financial market funds in Nigeria’s economic growth progress: Evidence and insights from manufacturing sector. Journal of Economics and Sustainable development, 8 (15), 1-10.
Nnamdi, I. S. (2015b). Financial market funds and economic growth nexus in Nigeria: A co- integration perspectives with lessons. European journal of business and management, 7(2), 191-202.
Nnamdi, I. S. (2015). Private vs public sector bank credits and economic growth nexus in Nigeria: Where Does Efficacy Rest? Research Journal of Finance and Accounting ,6(3),226-237.
Nnamdi, I. S. (2015). Financial market funds and economic growth nexus in Nigeria: A co- integration perspectives with lessons. European journal of business and management, 7(2), 191-202.
Ndudi, F. E., Olannye, A. A., & Iyamahbor, M. (2020). Capital market as a catalyst for economic growth: Nigeria in Perspective. Palarch’s Journal of Archaeology of Egypt/Egyptology .17(7),13123-13140.
North, D. C. (1981).Structure and change in economic history. (W.W. Norton, New York, NY).
Nwankwo, S. N., & Agbo, E. I. (2021). Financial markets efficiency and Nigeria economic development . Saudi Journal of Economics and Finance, 5(02), 859-865.
Obi, C. O. (2021). Money market instruments and economic growth of Nigeria. European Journal of Management and Marketing Studies, 6(2),150-166.
Odetayo, T. A., & Sajuyigbe, A. S. (2012). Impact of Nigerian capital market on economic growth and development. International Journal of Arts and Commerce, 1(5), 1-8.
Odunga, R., & Ayoyi, I. R. (2016). Impact of financial markets on the economic growth of east Africa. European Journal of Logistics, Purchasing and Supply Chain Management, 4(5), 25-33.
Okolie, J. I., & Okolie, D. O. (2022). Financial market, monetary policy and economic growth: Evidence from Nigeria. IIARD International Journal of Economics and Business Management (IJEBM), 8(2), 77-89.
Ogunsanwo, O. F., Adelugba, I. A., & Efuntade, A. O. (2023). Effects of financial market intermediation on economic growth in Nigeria. The Journal of Developing Areas, 57(2),52-64.
Olulu-Briggs, O. V. (2021). Money and capital market investments on economic performance in Nigeria: A Revisit. IOSR Journal of Economics and Finance. 12(2), 9-15.
Ologunwa, O. P., & Sadibo, O. V. (2016). Capital market development and economic growth in Nigeria: an empirical analysis. FUTA Journal of Management and Technology, Doi: 1.1/fjmt.2016/v1n1p5,48-59.
Osakwe, C. I., & Akunna, R. C. (2022). Private sector credit and Nigeria economic growth (1994-2019). International Journal of Multidisciplinary and Current Educational Research (IJMCER), 4(1), 308-315.
Oluwatosin, E. O., Adekanya T., & Yusuf, S. A. (2013). Empirical analysis of the impact of capital efficiency on economic growth and development in Nigeria. International Journal of Academic Research in Economics and Management Sciences, 2(6) 44-53.
Oluwatosin, E. O., Adekanya T., & Yusuf, S. A. (2013). Empirical analysis of the impact of capital efficiency on economic growth and development in Nigeria. International Journal of Academic Research in Economics and Management Sciences, 2(6) 44-53.
Oyintonefie, E. (2023). Analysis of financial markets and performance of Nigerian economy. EPRA International Journal of Socio-Economic and Environmental Outlook, 10(8), 35-44.
Shaw, E. S. (1976). Financial repression and liberalization, in Meier, G.M.(ed), Leading Issues in Economic Development, New York, Oxford University Press.
Shaw, E. S. (1973).Financial deepening in economic development. New York Oxford University Press.
Patrick, H. T. (1976). Demand following or supplying leading finance, in Meier, G.M.(ed):Leading Issues in economic development .Oxford University Press.
Ukpabi, I. O., Eleje, E., C., & Onu, C. (2021). Private sector credit and economic growth in Nigeria: A Model of ARDL Bounds Test. Journal of Emerging Technologies and Innovative Research, 8(12),45-55.
Ughulu, S. E., & Osas, A. M. (2020). Capital market operations and economic growth in Nigeria: An Empirical Verification. International Journal of Advanced Engineering and Management Research, 5(3), 1-18.
World Bank (2022).World bank lead economist for Nigeria and co-author report.
Published
2026-06-16
How to Cite
Obiageli Ngozi, M. (2026). FINANCIAL MARKET FUNDS AND ECONOMIC PERFORMANCE IN NIGERIA. GPH-International Journal of Business Management, 9(5), 98-112. https://doi.org/10.5281/zenodo.20717001
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Articles
Copyright (c) 2026 Mbelu, Obiageli Ngozi, (Ph.D)
The authors and co-authors warrant that the article is their original work, does not infringe any copyright, and has not been published elsewhere. By submitting the article to GPH-International Journal of Business Management, the authors agree that the journal has the right to retract or remove the article in case of proven ethical misconduct.
