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Foreign Capital Inflows and Unemployment in Nigeria: A New Evidence from ARDL-Bounds Testing Approach

Author

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  • Onyinye I Anthony-Orji
  • Anthony-Orji
  • Jonathan E Ogbuabor
  • Emmanuel O Nwosu

Abstract

Using a novel approach, this study disaggregates and estimates the impact of foreign capital inflows on unemployment in Nigeria by adopting the Auto-Regressive Distributed Lag- Unrestricted Error Correction Methodology (ARDL-UECM). The ARDL-bounds test co-integration results show evidence of co-integration between disaggregated Foreign Capital Inflow variables (such as Foreign Direct Investment, Foreign Portfolio Investment and Remittances) and unemployment rate in Nigeria within the period from 1977Q1 – 2013Q4. The empirical results also show that foreign direct investment, foreign private investment and trade openness have negative impact on unemployment rate. On the other hand and interestingly, remittances and real exchange rate show a positive impact. The study therefore recommends the routing of remittances through the banking channels which would help in allocating remittances and other financial flows to productive uses. Again, government should enact investor-friendly policies and build conducive business environment in order to attract more Foreign Capital Inflows which will support job creation for the teeming population and thereby reduce biting unemployment.

Suggested Citation

  • Onyinye I Anthony-Orji & Anthony-Orji & Jonathan E Ogbuabor & Emmanuel O Nwosu, 2018. "Foreign Capital Inflows and Unemployment in Nigeria: A New Evidence from ARDL-Bounds Testing Approach," International Journal of Business, Economics and Management, Conscientia Beam, vol. 5(6), pages 176-188.
    • Handle: RePEc:pkp:ijobem:v:5:y:2018:i:6:p:176-188:id:1200
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    Citations

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    Cited by:

    1. Anthony Orji & Jonathan E. Gbuabor & Christian E. Ugwu & Onyinye I. Anthony-Orji, 2019. "Cash Reserve Requirement and Credit to SMEs in Nigeria: An ARDL Bounds Test Aproach," Journal of Asian Business Strategy, Asian Economic and Social Society, vol. 9(1), pages 10-28, June.
    2. Anthony Orji & Godson Umunna Nwagu & Jonathan E. Ogbuabor & Onyinye I. Anthony-Orji, 2021. "Foreign Direct Investment and Growth Nexus: Further Evidence from Africa’s Largest Economy," Journal of Infrastructure Development, India Development Foundation, vol. 13(1), pages 65-78, June.
    3. Anthony Orji & Jonathan E. Ogbuabor & Chiamaka F. Okolomike & Onyinye I. Anthony-Orji, 2022. "Do Capital Inflows and Financial Development, Influence Economic Growth in West Africa? Further Evidence from Transmission Mechanisms," Econometric Research in Finance, SGH Warsaw School of Economics, Collegium of Economic Analysis, vol. 7(1), pages 71-94.
    4. 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.
    5. Razman Hafifi Redzuan & Mohamed Dahlan Ibrahim & Muhammad Zaly Shah Muhammad Hussein, 2019. "Entrepreneurial Logistics Education in Institutions of Higher Learning: The Case of Universiti Malaysia Kelantan," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(2), pages 58-61, July.

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