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Foreign Direct Investment in Nigeria: Reassessing the Role of Market Size

Author

Listed:
  • Ojide Makuachukwu Gabriel
  • Agu Osmond Chigozie
  • Eke Felix Awara

Abstract

This paper examines the influence of market size on foreign direct investment to Nigeria for the period 1970 – 2011. It answers the question: do multinational enterprises consider market size in the allocation of their foreign direct investment (FDI) to Nigeria? Unlike similar previous studies on Nigeria, this paper examines market size in terms of economy size and population size. Autoregressive Distributed Lag (ARDL) model and Granger Causality Tests were estimated. The results show that economy size and population size has positive and significant effect on foreign direct investment to Nigeria. Market size also Granger causes FDI to Nigeria. This paper, therefore, concludes that multinational enterprises consider Nigerian market size in the allocation of their foreign direct investment (FDI) to the country.

Suggested Citation

  • Ojide Makuachukwu Gabriel & Agu Osmond Chigozie & Eke Felix Awara, 2016. "Foreign Direct Investment in Nigeria: Reassessing the Role of Market Size," 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. 6(2), pages 95-104, February.
    • Handle: RePEc:hur:ijarbs:v:6:y:2016:i:2:p:95-104
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    References listed on IDEAS

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    6. Laura Resmini, 2000. "The Determinants of Foreign Direct Investment in the CEECs: New evidence from sectoral patterns," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 8(3), pages 665-689, November.
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    Cited by:

    1. Dimitra Mitsi & Constantina Kottaridi, 2022. "Fiscal and non-fiscal institutional context effects and foreign direct investment: empirical evidence in developing countries," SPOUDAI Journal of Economics and Business, SPOUDAI Journal of Economics and Business, University of Piraeus, vol. 72(1-2), pages 11-33, January-J.

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