Financial deepening and economic growth: A nexus

This study was conducted using time series data from the Central Bank of Nigeria's Statistical Bulletin.A model was created and the variables were subjected to a unit root test in which stationary were achieved at I(0) and I(1).The model was analyzed using Auto Regressive Distributed Lag (ARDL) including the Error Correction Model (ECM).Financial deepening is the term used to describe the increasing provision of financial services and developing financial markets within an economy.Financial deepening is associated with economic growth.While private-sector credit has no discernible effect on economic growth in Nigeria, the long-and short-term (ECM) findings showed that the money supply, stock market capitalization, financial saving, and bank liquid liabilities all have positive and significant effects on economic growth.The study's conclusions recommended that the authorities tasked with monetary regulation create and implement policies that will concentrate on deepening the financial sector and that financial institutions do everything in their power to increase the resources available to the private sector to support the real sector.