Journal of Economics and International Finance
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Article Number - C22203741531


Vol.5(8), pp. 307-317 , November 2013
DOI: 10.5897/JEIF2013.0533
ISSN: 2006-9812



Full Length Research Paper

Association between foreign capital inflow and macroeconomic factors: Evidence from Nigeria


Etumudon Ndidi Asien1* and Victor Oriavwote2




1Accounting and Finance Programme, Faculty of Humanities and Social Sciences, Federal University, Otuoke, P.M.B. 126 Yenagoa, Bayelsa State, Nigeria.

2Economics and Development Studies Programme, Faculty of Humanities and Social Sciences, Federal University, Otuoke, P.M.B. 126 Yenagoa, Bayelsa State, Nigeria.


Email: asienen@fuotuoke.edu.ng, ndidi_66@yahoo.co.uk






 Accepted: 10 October 2013  Published: 30 November 2013

Copyright © 2013 Author(s) retain the copyright of this article.
This article is published under the terms of the Creative Commons Attribution License 4.0


This paper empirically examines the association between foreign capital inflows to Nigeria and real growth rate of gross domestic product, domestic credit to the private sector, rate of inflation, perceived level of corruption and market capitalization.  Data covering the period 1982 and 2012 were analyzed using econometric models of cointegration technique with its implied error correction model (ECM). Results are consistent with a priori expectations as the parsimonious ECM tests suggest that high level of corruption constitutes the greatest impediment to foreign capital inflow to Nigeria.  Further, the documented evidence suggests that high rate of inflation has a negative impact on foreign capital inflow to Nigeria.  The short-run dynamic results suggest that domestic credit to the private sector, real growth rate of gross domestic product and market capitalization have been beneficial to foreign capital inflows to Nigeria. 

Key words: Foreign capital inflows, foreign direct investment, gross domestic product growth, real growth rate of gross domestic product, inflation, domestic credit to private sector, market capitalization, perceived level of corruption, Nigeria.

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APA (2013). Association between foreign capital inflow and macroeconomic factors: Evidence from Nigeria. Journal of Economics and International Finance, 5(8), 307-317.
Chicago Etumudon Ndidi Asien and Victor Oriavwote. "Association between foreign capital inflow and macroeconomic factors: Evidence from Nigeria." Journal of Economics and International Finance 5, no. 8 (2013): 307-317.
MLA Etumudon Ndidi Asien and Victor Oriavwote. "Association between foreign capital inflow and macroeconomic factors: Evidence from Nigeria." Journal of Economics and International Finance 5.8 (2013): 307-317.
   
DOI 10.5897/JEIF2013.0533
URL http://academicjournals.org/journal/JEIF/article-abstract/C22203741531

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