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Foreign Direct Investment, Electricity Power Supply and Economic Growth in Nigeria

Author

Listed:
  • Sherifatu O. Onayemi

    (Covenant University, Ota, Nigeria)

  • Philip A. Olomola

    (Obafemi Awolowo University, Ile-Ife, Nigeria.)

  • Philip O. Alege

    (Covenant University, Ota, Nigeria)

  • Oluwakemi O. Onayemi

    (Covenant University, Ota, Nigeria)

Abstract

This study examined the stimulation of foreign direct investment (FDI) inflows through constant electricity power supply for economic growth in Nigeria, by engaging time series data sourced from the world development indicators (WDI) for the period 1986 -2017 and employed the Autoregressive distribution lag econometric approach to co-integration. The gross domestic product growth rate per capita was the proxy for economic growth and the dependent variable, while the independent variables include foreign direct investment, labour force participation rate, gross fixed capital formation and electricity power supply. The result from the study showed that, in the long-run, increased FDI inflows, gross fixed capital formation, electricity power supply, have the potency of increasing economic growth by 30 per cent, 20 per cent and 6 per cent, respectively. Therefore, based on the results obtained, the study recommended that there should be constant electricity power supply to keep pace with productivity for efficient economic growth in Nigeria.

Suggested Citation

  • Sherifatu O. Onayemi & Philip A. Olomola & Philip O. Alege & Oluwakemi O. Onayemi, 2020. "Foreign Direct Investment, Electricity Power Supply and Economic Growth in Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 10(5), pages 243-247.
    • Handle: RePEc:eco:journ2:2020-05-28
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    References listed on IDEAS

    as
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    3. Dalia M. Ibrahiem, 2015. "Renewable electricity consumption , Foreign direct investment and Economic growth in Egypt: An ARDL approach," Proceedings of Economics and Finance Conferences 2204592, International Institute of Social and Economic Sciences.
    4. Zhang, Chi & Zhou, Kaile & Yang, Shanlin & Shao, Zhen, 2017. "On electricity consumption and economic growth in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 76(C), pages 353-368.
    5. Pham Dinh Long & Bui Hoang Ngoc & Duong Tien Ha My, 2018. "The Relationship between Foreign Direct Investment, Electricity Consumption and Economic Growth in Vietnam," International Journal of Energy Economics and Policy, Econjournals, vol. 8(3), pages 267-274.
    6. Oluwatoyin A. Matthew & Christian U. Ede & Romanus Osabohien & Jeremiah Ejemeyovwi & Fagbeminiyi F. Fasina & Doris Akinpelumi, 2018. "Electricity Consumption and Human Capital Development in Nigeria: Exploring the Implications for Economic Growth," International Journal of Energy Economics and Policy, Econjournals, vol. 8(6), pages 8-15.
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    Cited by:

    1. Umar Bala & Ayatu Yusuf & Rabiu Maijama'a, 2020. "The Impact Population Growth on Disaggregate Energy Generation Source from (Hydro Power, Natural Gas, Oil and Coal Source) in Nigeria," Asian Bulletin of Energy Economics and Technology, Asian Online Journal Publishing Group, vol. 1(1), pages 1-8.

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    More about this item

    Keywords

    Economic Growth; Electricity Power; Foreign Direct Investment;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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