Determinants of Capital Market Development in Nigeria: A Public Governance Approach

Purpose: This study examined the determinants of capital market development in Nigeria through the lens of six indicators of public governance, during the period, 1996-2023.Methodology: Autoregressive Distributed Lag (ARDL) technique was applied to the annual time series data on capital market development and governance indicators obtained from Central Bank of Nigeria’s Statistical Bulletin and World Bank’s Worldwide Governance Indicators respectively. Results: The study found that government effectiveness, political stability, and rule of law positively and significantly impacted capital market development while voice and accountability had negative and significant impact on capital market development. However, control of corruption, and regulatory quality had no significant impact on capital market development in Nigeria.Practical implication: Government effectiveness, political stability, rule of law, and voice and accountability are institutional determinants of capital market development in Nigeria.Originality: The study recommends for the improvement of public governance quality in Nigeria by putting in place policies and programmes that will facilitate government effectiveness, political stability, and rule of law, which will stimulate the development of capital market in Nigeria.Keywords: Capital Market; Determinants; Institutional Quality; Public Governance; Stock Market.DOI: 10.58869/EJABM11(2)/08