Public Borrowing and the Nigerian Economy: An Autoregressive Distributed Lag Model (ARDL) approach

Ewubare, Denis; Nteegah, Alwell; Godspower, Okpoi

doi:10.18535/ijsshi/v4i5.07

Cited by 4 publications

(2 citation statements)

References 3 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Moreover, Ewubare et al (2017) examine the effect of public borrowing on the growth of the Nigerian economy over the period 1980-2015. The ARDL result reveals that external debt is significant and positively stimulates economic growth.…”

Section: Review Of Literaturementioning

confidence: 99%

External Debt and Economic Growth Relationship in Nigeria: A Reconsideration

Kolawole

2024

TMP

View full text Add to dashboard Cite

This paper examines the relationship between external debt and economic growth over the period 1981-2021 in Nigeria using the ARDL econometric technique. As economic growth is elusive amid a high and increasing stock of external debt, the country is on the verge of losing access to international financing. Thus, the problem provokes raging discussion on whether, or not, external debt is growth-enhancing in Nigeria. As such, in an attempt to contribute to the discussion and proffer a solution to the problem, this paper builds on an earlier study. Consequent upon preliminary diagnostics, a one-way causality is established to run in a specific pairwise relationship as each of external debt and domestic investment Granger causes economic growth. Moreover, following the affirmation of the long-run relationship among the variables, estimation results reveal an inverse relationship between real interest rate and economic growth in the short-run. The results further establish that external debt impacts negatively, as against openness to trade and domestic investment averagely impacting positively, on economic growth in both the short-run and long-run. In essence, if it becomes pertinent for the country to borrow for growth-enhancing investments, the government is advised to borrow at a zero rate of real interest.

show abstract

Section: Review Of Literaturementioning

confidence: 99%

External Debt and Economic Growth Relationship in Nigeria: A Reconsideration

Kolawole

2024

TMP

View full text Add to dashboard Cite

show abstract

“…Government borrowing is as result as a shortage of revenue over expenditure [13]. Government can finance its fiscal deficits through borrowing from domestic and external sources.…”

Section: Government Domestic Borrowingmentioning

confidence: 99%

Government Domestic Borrowing and Private Sector Credit Crowding out: Empirical Evidence from Nigeria

Akanbi¹

2020

JIM

View full text Add to dashboard Cite

The impact of government domestic borrowing on the private sector credit has been a subject of great interest to researchers in finance. This study looked at the impact of government domestic borrowing on private sector credit in Nigeria. Government domestic borrowing can affect the private sector by crowding out private sector credit directly or indirectly through rising interest rates. The study employed an ex-post research methodology. Secondary data was collected from the Debt Management Office Nigeria and the Central Bank of Nigeria. The study covered a 10-year period from 2009 to 2018. An OLS multiple regression model was used. Government domestic borrowing was proxied by federal government bond issuances as the dependent variable. The deposit money banks' prime lending rates, private sector lending by the banks, the bank's investment in treasury bills and government bonds were the independent variables. The data was tested for heteroscedasticity, stationarity, normality, multicollinearity and serial correlation to examine the robustness of the model. The results showed that prime lending rate has a positive effect on government bond issuance although not significant. The findings also indicated that there is a negative relationship between government domestic bond issuance and the banks credit to private sector. However, this relationship is not statistically significant implying that government borrowing may not have crowded-out private sector. The relationship between government bond issuances and bank investment in treasury bills and government bond is negative although not significant. The findings of this study suggest that government domestic borrowing in Nigeria may have resulted in the reduction of private credit and this works through the credit channel and the interest rate channel.

show abstract

Nigeria’s Domestic Public Debts and Economic Development

Victoria

Mbadike

Ikechi³

2021

IJMSBA

View full text Add to dashboard Cite

This study investigates the effect of Nigeria’s domestic public debt on economic development of Nigeria spanning from 1981-2018. This is in response to the doubts being raised in some quarters as to whether the continuous increase in domestic debt over the years has led to the economic development of Nigeria as the former has been known to influence the later if well harnessed and executed. The secondary data used in the study were sourced from Central Bank of Nigeria Statistical Bulletin, Debt Management Office of Nigeria, World Bank Development Indicators and United Nations Development Program. The study made use of Ordinary Least Square Regression tools to determine the statistical relationship between Nigeria’s domestic public debt profile and Human Development Index as well as private sector investment. The outcome of study in the first model showed that domestic debt servicing and state governments’ domestic debts are significantly related to economic development. On the other hand, Federal domestic debt and State domestic debt are significantly related to private sector investment. The study therefore recommends that government should be cautious in her domestic borrowing policy given that servicing debt always becomes a burden to the sustainability of economic gains, in addition to its tendency of crowding-out private sector investment in Nigeria.

show abstract

Public Borrowing and the Nigerian Economy: An Autoregressive Distributed Lag Model (ARDL) approach

Cited by 4 publications

References 3 publications

External Debt and Economic Growth Relationship in Nigeria: A Reconsideration

External Debt and Economic Growth Relationship in Nigeria: A Reconsideration

Government Domestic Borrowing and Private Sector Credit Crowding out: Empirical Evidence from Nigeria

Nigeria’s Domestic Public Debts and Economic Development

Contact Info

Product

Resources

About