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Does Stock Market Development Raise Economic Growth? Evidence from Nigeria

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  • Abu Nurudeen

    (Academia de Studii Economice / Facultatea de Finante, Asigurari, Banci si Burse de Valori)

Abstract

This paper investigates whether stock market development raises economic growth in Nigeria, by employing the error correction approach. The econometric results indicate that stock market development (market capitalization-GDP ratio) increases economic growth. The recommendations therein include - removal of impediments to stock market development which include tax, legal, and regulatory barriers; development of the nation's infrastructure to create an enabling environment for where business can strive; employment of policies that will increase the productivity and efficiency of firms as well encourage them to access capital on the stock market; enhancement of the capacity of the Nigeria Security and Exchange Commission to facilitate the growth of the stock market, restore the confidence of stock market participants and safeguard the interest of shareholders by checking sharp practices of market operators (particularly speculators).

Suggested Citation

  • Abu Nurudeen, 2009. "Does Stock Market Development Raise Economic Growth? Evidence from Nigeria," The Review of Finance and Banking, Academia de Studii Economice din Bucuresti, Romania / Facultatea de Finante, Asigurari, Banci si Burse de Valori / Catedra de Finante, vol. 1(1), pages 015-026, December.
  • Handle: RePEc:rfb:journl:v:01:y:2009:i:1:p:015-026
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    References listed on IDEAS

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    Cited by:

    1. Nyasha, Sheilla & Odhiambo, Nicholas M., 2015. "Financial systems and economic growth: empirical evidence from Australia," Working Papers 18927, University of South Africa, Department of Economics.
    2. repec:hur:ijarbs:v:7:y:2017:i:11:p:127-140 is not listed on IDEAS
    3. repec:rss:jnljfm:v2i3p3 is not listed on IDEAS
    4. repec:taf:wjabxx:v:18:y:2017:i:1:p:1-23 is not listed on IDEAS
    5. repec:rss:jnljfe:v5i1p2 is not listed on IDEAS
    6. Sheilla Nyasha & Nicholas M. Odhiambo, 2015. "The Impact of Banks and Stock Market Development on Economic Growth in South Africa: an ARDL-bounds Testing Approach," Contemporary Economics, University of Finance and Management in Warsaw, vol. 9(1), April.
    7. Nyasha S. & Odhiambo N. M., 2016. "The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom," Global Economy Journal, De Gruyter, vol. 16(2), pages 389-410, June.
    8. Nyasha, Sheilla & Odhiambo, Nicholas M., 2015. "Do financial systems spur economic growth in the USA? An empirical investigation," Working Papers 18833, University of South Africa, Department of Economics.
    9. repec:rss:jnljfe:v4i3p1 is not listed on IDEAS
    10. Sheilla Nyasha & Nicholas M. Odhiambo, 2017. "Banks, Stock Market Development and Economic Growth in Kenya: An Empirical Investigation," Journal of African Business, Taylor & Francis Journals, pages 1-23.

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