Effects of Domestic Debt Securities on Economic Growth in Nigeria

Ukeje Chiemezie Desmond, Nwachukwu Fortune Ihuoma and Nwachukwu Edwin Udochukwu
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Ukeje Chiemezie Desmond: Department of Economics, Nnamdi Azikiwe University Awka
Nwachukwu Fortune Ihuoma: Department of Economics, Nnamdi Azikiwe University Awka
Nwachukwu Edwin Udochukwu: Department of Economics, Nnamdi Azikiwe University Awka

International Journal of Research and Innovation in Social Science, 2023, vol. 7, issue 9, 1553-1567

Abstract: Debt is considered beneficial for economic growth due to its overriding impact on savings, investment, financial deepening, and institutions. However, despite the fact that studies that attempted to examine the effect of domestic debt securities on economic growth in Nigeria have proliferated in recent years, only a handful has been able to measure individually the impact of the various debt securities on economic growth in developing countries. It is against this backdrop that this study is undertaken to determine the effect of debt securities on economic growth in Nigeria. The study used time series data covering a period of 22 years (1999-2021) and employed the Auto regressive distributive lag (ARDL) technique to empirically study the effect of the treasury bills, treasury bonds, government bonds and promissory notes on economic growth in Nigeria. The data used for the analysis were sourced from the World Development Indicators (2021) and CBN Statistical Bulletin (2021). The findings revealed that treasury bills, treasury bonds, government bonds and promissory notes all had positive effects on economic growth in Nigeria both in the short and long run. Therefore, the study recommends for consistent implementation of wider monetary policy reforms that promises assured returns and stability of funds to investors in order to promote investment in these instruments. Institutions such as SEC, Pension funds, Insurance companies, should be encouraged to invest in the listed instruments.

Date: 2023
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