Effect of Stock Market Private Investment on Economic Growth in Nigeria

Abstract

This study examines the effect of stock market private investment on economic growth
in Nigeria using quarterly data spanning from 2000q1 to 2021q4. Auto-Regressive
Distributive Lag (ARDL) Model was used and the findings unveiled that private
investment has a positive but statistically insignificant effect on gross domestic product
in Nigeria. In contrast, market capitalization has a positive and statistically significant
effect on Nigeria's gross domestic product. Furthermore, the interest rate has a
negative but statistically significant effect on gross domestic product in Nigeria. In
contrast, the inflation rate has a negative and statistically insignificant effect on
Nigeria's gross domestic product. Additionally, the exchange rate has a negative but
statistically significant effect on gross domestic product in Nigeria. The study strongly
recommends that the Nigerian government should address the shortage of investment
assets through effective policy measures that enhance the performance of the stock
market in Nigeria and to restore the confidence of the investors. Also, the Government
should stabilize the exchange rate to encourage foreign private investment.