Capital Flight and Nigeria Economic Growth

The study explored the impact of capital outflow in Nigeria and focused on its implications for the country's emerging economy. It reviews relevant literature and theories. It applied the Augmented Dickey-Fuller test to analyze the time series data obtained for the investigation. The ARDL bounds tests for cointegration was used to determine the relationships among the variables. The autoregressive distributed lag method was also employed to evaluate the short- and long-term associations between the explanatory factors and economic growth. Findings reveal a limited correlation between capital outflow and economic growth, whereas foreign direct investment showed a minor negative impact in the long run. It was also revealed in the investigation that leadership style and Governance contribute to capital flight in the country. Recommendations were to the effect that, creation of a favourable economic environment was necessary to reduce capital outflow, promote trade liberalization, and encourage regional integration to enhance market access.