FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH IN NIGERIA

This work, which deviates from previous research by employing several econometric methodologies to analyze the financial growth link between 1990 and 2022, attempts to investigate the relationship between financial development and economic growth in Nigeria. The results show that, over time, financial development and economic expansion go hand in hand. Economic growth is significantly influenced by financial development and inflation, while trade openness has little discernible effect on the latter. Consequently, we recommend that steps be made to ensure that credit extended to the private sector is not misdirected or misallocated, but rather is used in areas of the economy that are genuinely productive. Over time, this will lead to increased output for export and domestic consumption. Trade openness will consequently rise significantly and continue to have a positive, long-lasting effect on the economy.