The study adopts the multivariate VECM to investigate the causality between financial depth and economic growth in Nigeria from 1971 to 2008. The results suggest that financial depth and economic growth have a stable long-run relationship. The study supports the demand-following hypothesis for the banking sector’s private sector credit and real broad money supply; while it supports the supply-leading hypothesis for loan deposit ratio and bank deposit liabilities.The major finding is that the financial depth indicator used has great influence on the causal inference. This result validates Agu and Chukwu (2008) which employed the Toda and Yamamoto (1995) causality testing approach.

(2009). Multivariate causality between financial depth and economic growth in Nigeria [journal article - articolo]. In SAVINGS AND DEVELOPMENT. Retrieved from http://hdl.handle.net/10446/27449

Multivariate causality between financial depth and economic growth in Nigeria

2009-01-01

Abstract

The study adopts the multivariate VECM to investigate the causality between financial depth and economic growth in Nigeria from 1971 to 2008. The results suggest that financial depth and economic growth have a stable long-run relationship. The study supports the demand-following hypothesis for the banking sector’s private sector credit and real broad money supply; while it supports the supply-leading hypothesis for loan deposit ratio and bank deposit liabilities.The major finding is that the financial depth indicator used has great influence on the causal inference. This result validates Agu and Chukwu (2008) which employed the Toda and Yamamoto (1995) causality testing approach.
articolo
2009
SAVINGS AND DEVELOPMENT
La présente étude utilise le modèle de Johansen et Juselius (1990) et Juselius (1988, 1992) et adopte VECM pour comprendre le lien de causalité entre la profondeur financière et la croissance économique du Nigéria de 1971 à 2008. Les résultats suggèrent que la profondeur financière et la croissance économique ont une relation stable à long terme. L’étude soutient l’hypothèse demand-following en fonction de macrovariables liées au secteur bancaire qui concernent le crédit au secteur privé et de l’offre de monnaie au sens large, tout en soutenant l’hypothèse supply-leading sur la base d’autres variables (loan deposit ratio et bank deposit liabilities). Les résultats indiquent que l’indicateur de la profondeur financière influence le rapport de causalité et le résultat confirme l’étude de Agu et Chukwu (2008) qui emploie l’approche de causality testing de Toda et Yamamoto (1995).
OKECHUKWU CHUKWU, Jude; CHIKE AGU, Cletus
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