Nigeria’s Macroeconomic Growth And Sectoral Foreign Direct Investment Sensitivity

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Ikechukwu A Mobosi
Patrick O Okonta
C. Emmanuel Nwankwo

Abstract

The role of Foreign direct investment in economic growth’s  prospects in an economy cannot be overemphasised . An ownership stake in a foreign company or project is known as a foreign direct investment (FDI) and is made by a foreign investor, business, or government. FDI  promotse and maintains economic growth in both the investing nation and the recipient nation. It stimulates economic growth through investment in the critical sectors of the economy direct the economy to the path of growth.This work adopted accelerator theory of investment.Our findings show that a unit rise in  Gross domestic product (GDP) over the long run results in a 0.883638 decline in foreign direct investment to Nigeria's mining and quarrying industry which is not in consonance with apriori expectation.The coefficient of LPOP(Log of population) is 11.30166, demonstrating that, when all other factors are held constant, a unit increase in population over time results in an increase of 11.30166 units in foreign direct investment into Nigeria's mining and quarrying industries. The coefficient of INFR(Inflation rate) is -0.004723, with all other factors kept constant, a unit increase in the inflation rate results in a long-term drop of 0.004723 units in foreign direct investment to Nigeria's mining and quarrying sector.A unit increase in the exchange rate causes a 0.007461 unit drop in foreign direct investment to the mining and quarrying industry in Nigeria, according to the coefficient of EXR,(Exchange rate) which is -0.007461 when all other factors are held constant. In the long run, a unit rise in the unemployment rate causes a 0.042331 unit increase in foreign direct investment to the mining and quarrying sector in Nigeria, according to the coefficient of UR,(Unemployment rate) which is 0.042331.

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How to Cite
Mobosi, I. A., Okonta, P. O., & Nwankwo, C. E. (2024). Nigeria’s Macroeconomic Growth And Sectoral Foreign Direct Investment Sensitivity. University of Nigeria Journal of Political Economy, 14(1). Retrieved from https://unjpe.com/index.php/UNJPE/article/view/252
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Author Biographies

Ikechukwu A Mobosi, University of Nigeria, Nsukka

Department of Economics

Patrick O Okonta, University of Nigeria, Nsukka

Department of Economics

C. Emmanuel Nwankwo, University of Nigeria, Nsukka

Department of Economics

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