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Article
Publication date: 31 December 2010

Esther O. Adegbite and Folorunso. S. Ayadi

The study investigates the relationship between foreign direct investment flows and economic growth in Nigeria. The study became necessary because as never before, the civilian…

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Abstract

The study investigates the relationship between foreign direct investment flows and economic growth in Nigeria. The study became necessary because as never before, the civilian governments since 1999 have employed several strategies to ensure increased flow of FDI into Nigeria because of its perceived benefits as lauded in the theoretical literature as the panacea for economic underdevelopment. The study utilized simple OLS regression analysis and conducted various econometrics tests on our model so as to obtain the best linear unbiased estimators. The study confirmed the beneficial role of FDI in growth. However, the role of FDI on growth could be limited by human capital. The study concluded that indeed, FDI promotes economic growth, and hence the need for more infrastructural development, ensuring sound macroeconomic environment as well as ensuring human capital development is essential to boosting FDI productivity and flow into the country.

Details

World Journal of Entrepreneurship, Management and Sustainable Development, vol. 6 no. 1/2
Type: Research Article
ISSN: 2042-5961

Keywords

Article
Publication date: 2 July 2008

Esther O. Adegbite, Folorunso S. Ayadi and O. Felix Ayadi

This paper aims to investigate the impact of huge external debt with its servicing requirements on economic growth of the Nigerian economy so as to make meaningful inference on…

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Abstract

Purpose

This paper aims to investigate the impact of huge external debt with its servicing requirements on economic growth of the Nigerian economy so as to make meaningful inference on the impact of the debt relief which was granted to the country in 2006.

Design/methodology/approach

The neoclassical growth model which incorporates external sector, debt indicators and some macroeconomic variables was employed in this study. The paper investigates the linear and nonlinear effect of debt on growth and investment utilizing the ordinary least squares and the generalized least squares.

Findings

Among other things, the negative impact of debt (and its servicing requirements) on growth is confirmed in Nigeria. In addition, external debt contributes positively to growth up to a point after which its contributions become negative reflecting the presence of nonlinearity in effects.

Originality/value

Nigeria's external debt is analyzed in a new context utilizing a different but innovative model and econometric techniques. It is of tremendous value to researchers on related topic and an effective policy guide to policymakers in Nigeria and other countries with similar characteristics.

Details

International Journal of Emerging Markets, vol. 3 no. 3
Type: Research Article
ISSN: 1746-8809

Keywords

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