Effect of Domestic Savings and Investments on Nigeria’s Economy: 1981-2020

Remigius Chinwoke, Ejinkonye, and Ikeotuonye Victor, Okonkwo, (2022) Effect of Domestic Savings and Investments on Nigeria’s Economy: 1981-2020. Asian Journal of Economics, Business and Accounting, 22 (9). pp. 37-50. ISSN 2456-639X

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Abstract

This study assessed effect of gross domestic savings and investments on Nigeria’s economy. The poor economic well-being in Nigeria seems to be caused by poor savings and consequent poor investment. There seems to be weak links among domestic savings, domestic investment and economic growth in Nigeria possibly due to low income, policy inconsistencies, low productivity among others. The general objective of the study was to examine the effect of gross domestic savings and investments on the Nigerian economy for the period 1981-2020. The data used were extracted from the data base of World Development Indicators. Harrod-Domar growth Model and neoclassical growth theory of savings and investments explained the conceptual framework of this study. The unit root test, co-integration test and regression analysis were used for data analysis. Using regression techniques the results showed that there is positive and significant relationship between gross domestic savings and gross domestic product per capita; there is negative but significant relationship between gross domestic investment and gross domestic product growth rate per capita; there is positive and significant relationship between gross domestic savings and adjusted net national income per capita; and there is negative but significant relationship between gross domestic investments and adjusted net national income per capita in Nigeria. Thus, gross domestic savings and investments contributed to economic growth and development in Nigeria. The work recommended that the Nigerian monetary authority should sustain the monetary policy rate between 11% and 12% and encourage savings deposit rate to be between 1.5% and 2.5%; and investment environment should be conducive through policy consistency from the Government; and that capital flight need to be curbed by improving ease of doing business in Nigeria by streamlining business registration process, and ensuring enforcement of national digital policy.

Item Type: Article
Subjects: Science Repository > Social Sciences and Humanities
Depositing User: Managing Editor
Date Deposited: 25 Feb 2023 06:47
Last Modified: 07 Mar 2024 03:58
URI: http://research.manuscritpub.com/id/eprint/1382

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