IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-05148322.html
   My bibliography  Save this paper

Share Prices Volatility and Economic Growth in Nigeria (1980 – 2018)

Author

Listed:
  • Keania Gbenedum Nwako

    (Department of Economics, Rivers State University, Port Harcourt, Nigeria.)

  • A. I Okidim

    (Department of Agric and Applied Economics, Rivers State University, Port Harcourt, Nigeria.)

  • Godwin Lebari Tuaneh

    (Department of Agric and Applied Economics, Rivers State University, Port Harcourt, Nigeria.)

Abstract

This research paper investigated the effects of share prices volatility on economic growth in Nigeria for the period 1980 to 2018. The research utilized secondary data which was sourced from the Nigeria Stock Exchange shares price list and the CBN statistical bulletin published on their website. Data for the study comprised of those on stock market prices in 5 sectors of the NSE and the growth rate of gross domestic product at constant basic prices. The Pooled Mean Group (PMG) of panel Autoregressive Distributed Lag Model (ARDL) method of analysis was adopted and analysis done using Eviews 10.0. Findings of the study showed that in the long run, both share price and share price volatility had positive signs. This implies that their shocks affected gross domestic product growth rate positively. The short-run Error Correction Term (ECT) had a coefficient of -0.512 and was statistically significant (PV<0.05. the negative sign indicated the correction of previous error in the subsequent term, the value (-0.512) implied that the speed of adjustment from the previous period to the long-run equilibrium is 51.2%. Hence, the model can converge to long-run equilibrium at a speed of 51.2%. In the short-run, share price volatility was negatively signed and statistically significant at 5% level of significance (t-cal = -1.984, PV = 0.044). This means that in the short-run (short term), volatility shocks reduced gross domestic product growth. The empirical discoveries in this research painted a negative and unstable future for the Nigerian economic growth if share price shock persists. Therefore, for long run economic growth, there is a strong need for policy makers to concentrate on policy that will improve and strengthen the economic structure. Thus, the study recommends that efforts be made towards enhancing and strengthening fiscal institutions so as to improve management of share revenues while promoting accountability and encouraging fiscal prudence in the economy.

Suggested Citation

  • Keania Gbenedum Nwako & A. I Okidim & Godwin Lebari Tuaneh, 2022. "Share Prices Volatility and Economic Growth in Nigeria (1980 – 2018)," Post-Print hal-05148322, HAL.
    • Handle: RePEc:hal:journl:hal-05148322
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a
    for a similarly titled item that would be available.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-05148322. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.