Momodu and Monogbe
Greener Journal of Economics and Accountancy Vol. 6 (1), pp. 001-011, February 2017
ISSN: 2354-2357 © 2017 Greener Journals
Manuscript Number: 021617027
Industrialization Drivers, Causality and Economic Development in Nigeria
Momodu Ayodele A1 and Monogbe Tunde G2
1Department of Banking and Finance, Rivers State University of Science and Technology, Nkporlu, Port Harcourt, Rivers State Nigeria
2Department of finance and banking, faculty of management science university of Port Harcourt rivers state, Nigeria
This paper empirically examines the short run, long run and causality spill over influx of foreign direct investment, labour market condition, trade openness, exchange rate and aggregate bank lending, been the determinant of industrialisation and it eclectic contribution to the development of the Nigeria economy between the periods 1980 to 2015. Findings reveals that three of the five variables under investigation passes the test of significance at 5% alpha level. We found foreign direct investment and exchange rate to be positive and significant in promoting economic development over the period of study, while aggregate bank lending and net export report a positive with a corresponding negative coefficient which suggests an inverse relationship to economic development. Labour market condition appears to be insignificant in stimulating economic development. The inverse contribution of aggregate bank lending to economic development could be attributed to excessive channelling of borrowed fund towards recurrent expenditure, while the capital investment which is capable of illuminating economic development are been ignore most time. Prior to our findings, the study concluded that foreign direct investment, exchange rate, net export and aggregate bank lending are significant drivers of industrialisation in the Nigeria context. On this premises, the study recommends that more effort be put in place to resuscitate the dormant industrial firms in the country as they appear to be a key contributor to sustainable economic development.
Key words: Economic Development, Industrialisation drivers, Causality.
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