THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA

Format: MS WORD | Chapter: 1-5 | Pages: 74 | 810 Users found this project useful | Price NGN5,000

THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA

ABSTRACT

The importance of investment in economic growth cannot be overemphasized. This has led to an upsurge in the study of its determinants. This research therefore, seeks to investigate the impact of interest rate liberalization on investment in Nigeria from 1970-2012. Using the Error Correction Model (ECM), the result indicates that a long run relationship exists among the variables. The result further reveals that all the variables have significant impact on investment. The study equally shows that there is no differential impact of interest rate liberalization on investment in Nigeria during the pre and post-liberalization regimes. Also, the impulse responses of these variables to shocks in theextraneous variables were verified; using the Multiple-Equation VAR models. In addition, the variance decomposition result shows thatPeriod 2 shows a standard deviation value of 97.23 in investment resulting from own shock, 2.44 to a response to a shock from interest rate, 0.0186 to a response from market capitalization rate,0.205900 to a response to public expenditure and 0.101933 to response to trade openness. In period 10, investment responds positively with a standard deviation of 18.77 originated from own shock and standard deviation values of 8.05, 7.94, 12.43 and 15.59 arising from a shock from interest rate, market capitalization rate, public expenditure and trade openness respectively. It is recommended that polices to make interest rate attractive to investors as well as improve trade should be encouraged. Also broadening the capital market and improving infrastructure through increased capital expenditure should be pursued. In addition to these, there should be consistency in policies so that policy summersaults does not affect investment.

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

The Nigerian economy has at different times witnessed enormous interest rate swings in different sectors of the economy since the 1970s and mid 1980s under a regulated regime. The preferential interest rates were based on the premise that the market, if freely applied would exclude some priority sectors. Thus, interest rates were adjusted through the market forces in order to promote increased level of investment in the various preferred sectors of the economy. Prominent among the preferred sectors were the agricultural, manufacturing and solid mineral sectors which were accorded priority and deposit money banks were directed to charge preferential interest rates on all loans to encourage the upsurge of small-scale industrialization which is a catalyst for economic development (Udoka, 2000). According to Mckinnon (1973) and Shaw (1973), this situation can ignite financial repression which occurs mostly when a country imposes ceiling on deposit and lending nominal interest rate at a low level relative to inflation. The resulting low or negative interest rates discourage savings mobilization and the channelling of mobilized savings through the financial system. This has a negative effect on the quantity and quality of investment and hence economic growth.

Closely followed by the regulated interest rate regime was the interest rate reform, a policy evolved under the financial sector liberalization. The policy was put in place to achieve efficiency in the financial sector, thus, engendering financial deepening. In Nigeria, financial sector reforms started with the deregulation of interest rate in August, 1987 (Ikhide & Alawade, 2001). Since then, the Nigerian government has been pursuing a market determined interest rate which does not permit a direct state intervention in the general direction of the economy (Nyong, 2007).Since the introduction of the interest rate liberalization concept in the 1980s, many countries such as Angola, Burundi, Congo, Ivory Coast, Ghana, Malawi, Nigeria, China, India etc.

DOWNLOAD THE FULL PROJECT

Project information

Project Price

NGN5,000
Number of Pages

74
Number of Chapters

1-5
Additional Content

Abstract, Table of Content & Questionnaire

THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA

Not The Topic You Are Looking For?

For Quick Help Chat with Us Now!

+234 813 292 6373

+233 55 397 8005

Search for your project topic

HOW TO GET THE COMPLETE PROJECT ON THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA INSTANTLY

Click on the Download Button above.
Select any option to get the complete project immediately.
Chat with Our Instant Help Desk on +234 813 292 6373 for further assistance.
All projects on our website are well researched by professionals with high level of professionalism.

Here's what our amazing customers are saying

Uduak From Uniuyo

IProjectMaster is the best project site for students. Their works are unique and free of plagiarism!

Excellent

Emmanuel Essential

Kogi state University

I actually took the risk,you know first time stuff But i was suprised i received as requested. I love you guys 🌟 🌟 🌟 🌟

Very Good

Adam Alhassan Yakubu

UDS

Excellent work and delivery , I promise to share my testimonies everyone in need of this kind of work. You're the best

Excellent

Abdul Mateen Iddrisu

UDS

At first I taught is a site full of fraudsters until I saw my project in my Gmail after my payment.. THANK YOU IPROJECTMASTER and May God the almighty bless u guys abundantly

Excellent

Abdulrazak Bello Marsha

Usman Dan fodio University

It was quite a better guide for project and paper presentation purpoting. Many thanks.

Average

JONNAH EHIS

Ajayi Crowther University, Oyo

I was scared at first when I saw your website but I decided to risk my last 3k and surprisingly I got my complete project in my email box instantly. This is so nice!!!

Excellent

Gbadamosi Solomon Oluwabunmi

Lasu

Swift delivery within 9 minutes of payment. Thank you project master

Excellent

Merry From BSU

I am now a graduate because of iprojectmaster.com, God Bless you guys for me.

Excellent

Samuel From Ajayi Crowther University

You guys just made life easier for students. Thanks alot iprojectmaster.com

Excellent

Abdulrahman Jibrin

Nti Abaji

Nice one work prompt delivery tanx

Very Good

View All Reviews

FREQUENTLY ASKED QUESTIONS

How do I get this complete project on THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA? Simply click on the Download button above and follow the procedure stated.
I have a fresh topic that is not on your website. How do I go about it?
How fast can I get this complete project on THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA? Within 15 minutes if you want this exact project topic without adjustment
Is it a complete research project or just materials? It is a Complete Research Project i.e Chapters 1-5, Abstract, Table of Contents, Full References, Questionnaires / Secondary Data
What if I want to change the case study for THE IMPACT OF INTEREST RATE LIBERALIZATION ON INVESTMENT IN NIGERIA, What do i do? Chat with Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately
How will I get my complete project? Your Complete Project Material will be sent to your Email Address in Ms Word document format
Can I get my Complete Project through WhatsApp? Yes! We can send your Complete Research Project to your WhatsApp Number
What if my Project Supervisor made some changes to a topic i picked from your website? Call Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately
Do you assist students with Assignment and Project Proposal? Yes! Call Our Instant Help Desk Now: +234 813 292 6373 and you will be responded to immediately
What if i do not have any project topic idea at all? Smiles! We've Got You Covered. Chat with us on WhatsApp Now to Get Instant Help: +234 813 292 6373
How can i trust this site? We are well aware of fraudulent activities that have been happening on the internet. It is regrettable, but hopefully declining. However, we wish to reinstate to our esteemed clients that we are genuine and duly registered with the Corporate Affairs Commission as "PRIMEDGE TECHNOLOGY". This site runs on Secure Sockets Layer (SSL), therefore all transactions on this site are HIGHLY secure and safe!