An Empirical Investigation of the Relationship between Financial Development and Merchandise Trade in Nigeria

Oluwafemi Adeboje, Raifu Isiaka Akande, Ogbeide Frank I. and Orija Olusegun Abiola
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Raifu Isiaka Akande: Department of Economics, Faculty of Economics and Management Sciences, University of Ibadan.
Ogbeide Frank I.: Ph.D. is a Principal Economist in the Research, Policy & International Relations Department, Nigeria Deposit Insurance Corporation, Abuja.
Orija Olusegun Abiola: Department of Economics, Faculty of Economics and Management Sciences, University of Ibadan.

Zagreb International Review of Economics and Business, 2021, vol. 24, issue 1, 1-20

Abstract: This study examines the empirical relationship between financial development and merchandise trade in Nigeria using annual data from 1981 to 2014. The empirical analysis is also carried out on the disaggregated components of the trade, that is, merchandise export and import, for robust analysis. Estimation results based on error correction model show that there exists significant long run positive relationship between financial development and export in Nigeria over the period under study. There is need for government to therefore provide enabling environment for financial sector to thrive through sound macroeconomic policies for effective economic diversification through export.

Keywords: Error correction model; merchandise trade; financial development (search for similar items in EconPapers)
JEL-codes: C22 F49 G28 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:zirebs:v:24:y:2021:i:1:p:1-20:n:1001

DOI: 10.2478/zireb-2021-0001

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