Dr. BigBen Ogbonna

This paper examined the causal relationship between financial development and economic growth in Nigeria and South Africa by employing co integration test, VECM and granger causality test using the data of annual time series for the period 1980 – 2014. The objective of the study is to examine the applicability or otherwise of stage of development hypothesis of financial development by Hugh Patrick (1966) in both countries which states that the direction of causality between financial development and economic growth changes over the course of development. The result of granger causality indicates a unidirectional causality running from financial development (DCPSGDPN) to economic growth in Nigeria and a bidirectional causality from financial development (DCPSGDPS) to economic growth in South Africa validating the Supply leading hypothesis of financial development by Hugh Patrick (1966) .This study therefore concludes that supply – leading phenomena (Finance – led growth) is evident i...

This study was commissioned to investigate for long run and causal relationship between foreign investment inflows and exchange rate dynamics in Nigeria. Foreign capital is decomposed into foreign direct investment (FDI) and foreign portfolio investment (FPI) to enable us look at both the real and financial sectors of the economy. Results established that there exists a long run association between exchange rates dynamics and foreign capital inflows to Nigeria. This was evident by the values of bound test F-Statistic of 61.82058 and 33.18053 for foreign direct investment and foreign portfolio investment models respectively. The coefficients of error correction terms lagged one period in the short-run models of FDI and FPI are negative and statistically significant at 1% level, meaning that in the both models, the independent variables jointly and significantly cause FDI and FPI respectively at least in the short run. Furthermore, this study has established that, for Nigeria, exchang...

This paper examines the plausibility of Wagner’s ‘law’ for Greece for the period 1948 – 2010. The paper uses modern time-series econometric techniques boarding on co integrations analysis to test for the validity of Wagner’s law, which states that the growth of public expenditure can be explained as a result of the increase in economic activity. The results of the causality test indicate that there is no evidence to support either Wagner’s Law or Keynes’s hypothesis for Greek economy. Furthermore, evidences from Johansen Maximum Likelihood co-integration test and LSEM both reveal that Wagner’s law is not supported for Greece. These results suggest that despite the often vocal opposition from the country's powerful labor unions and the general public, Greek Government should continue with the policy of cutting government spending, downsizing of the public sector, and reforming the labor and pension systems to promote greater private sector involvement in economic activities.

Terrorism financing has become a threat to humanity and democracy in Africa. Most terrorist organizations in Africa need money to carry out their massacre activities, which threatens African democracy, political stability, and economic development. The wave of terrorism activities and terrorism financing in Africa have remained a major cause for concern. The pervasive widespread of terrorist attacks seem to have defile all situations. Apparently, in Nigeria, terrorist attack reports have become a daily menu. The lethal killings by Boko Haram in Nigeria can be likened to the era of the Nigerian Civil war. This paper therefore, compares and contrasts the terrorism financing vis-à-vis the nascent democracy in Africa with a focus on Nigerian cases of Boko Haram. Terrorism financing misrepresents democratic growth and economic development in Africa, which brought about a rise in terrorist widespread and negative financial growth and progress in Nigeria and Africa. The multi-dimensional o...

Abstract This paper is set to investigate the existence of a significant long-run relationship between nominal interest rates and price levels and examine the possible causal link between the variables of interest using quarterly data on Nigeria for the periods of 1970 – 2012. Maximum likelihood method of co-integration, suggested by Johansen (1988, 1991) and Granger causality in an ADL model with p and q lags suggested by Koop (2005) are implemented to determine the number of co-integrating vectors and verify the nature and direction of causality between nominal interest rates and the price levels in Nigeria respectively. The co-integration results show that the null hypothesis of no significant long-run stable relationship between nominal interest rates and the price levels is rejected for Nigeria with the identification of one co-integrating vector. This result fines support for Gibson Paradox in Nigeria which supports the view that nominal interest rates and the price levels tre...

Abstract The objective of this paper is to gauge the correlation between government size and developments in consumer price index with recourse to Nigeria for the period of 1981-2013. The study was implemented within the frame-work of the so called systems equations, founded on co-integration and vector error correction model (VECM) methods. The results indicate that: (i) Long run equilibrium relationship exist between consumer price index and government size in Nigeria. (ii) No long run causal relationship was identified between consumer price index and government expenditure in Nigeria. (iii) There is no short run causality running from government expenditures to consumer price index in Nigeria. The results further suggest that a development in consumer price index in Nigeria is a function of its previous period values (inflationary expectations) and exchange rate of the domestic currency, meaning that the much touted assumption by policy makers in Nigeria, that government size ca...

ABSTRACT This paper presents an empirical analysis of Wagner‟s law in the case of South Africa over the period 1950–2008. The paper uses modern time-series econometric techniques, bordering on co-integration analysis to test the law‟s proposition that in the course of economic development, government size in the GDP increases. The results of this study support the empirical validity of Wagner‟s law for South Africa. In effect, the validity of Wagner‟s law, which states that the growth of public expenditure is a function of increase in economic activity, is therefore verified for the South African economy. In addition, the long data sample ensures the reliability of the results in terms of economic significance and statistical inference. Absence of structural break and the stability of the time series data employed are verified by the results of the CUSUM conducted. Policy-wise, the results imply that development plans of South Africa must incorporate such fiscal policy measures that would guarantee commensurate growth in government revenue.

ABSTRACT This paper investigates the behaviour of Nigeria's aggregate imports between the periods 1980-2005. In the empirical analysis of the aggregate import demand function for Nigeria, cointegration and Error Correction modeling approaches have been used. Our econometric estimates suggest that real GDP largely explains the import demand function. This is significant for policy makers as it indicates the ineffectiveness of using exchange rate policy option in influencing import demand in Nigeria.

This paper attempts to identify the relationship between the exchange rate and trade balance in Benin Republic for the period 1950 to 2008. We have employed co integration analysis and vector error correction modeling (VECM) to enable us determine the long run, as well as short-run dynamics, between the exchange rate and the trade balance for Benin. The key findings of our empirical exercise are that there is one long run steady state co integrating relationship between trade balance and exchange rate for Benin Republic. In the short run, there is no significant causal relationship existing between exchange rates and trade. The estimated coefficient of the error correction term lagged one period, EC (-1) is statistically significant at 5 percent level and with the appropriate negative sign and fractional. This provides evidence of significant long run causal relationship existing between exchange rates and the trade balance for Benin Republic. This suggests that for Benin Republic, ...