EFFECT OF INTEREST RATE ON ECONOMIC GROWTH IN NIGERIA
ABSTRACT
Government should provide an enabling environment for investment to be productive in Nigeria since real interest rate makes investment to go higher, that is investment is a kind of medium that links Investment and Economic growth. Secondly, Government should make policies both monetary and fiscal that will aid investment to be productive in other to be able to achieve the relationship between interest rate and economic growth and finally I recommend that the government and financial authorities should implement policies that favour income growth such as job creation and encouragement of small scale businesses which will in turn increase investment significantly
CHAPTER ONE
Introduction
1.1 Background Of The Study
The effect of Interest rate on economic growth in Nigeria has been a matter of controversy over a long period of time. Yet, what constitutes an appropriate interest rate policy still remains a puzzling question. Until the early 1970s, the main line of argument was that because the interest rate represents the cost of capital, low interest rates would encourage the acquisition of investment and promote economic growth, a notion consistent with the Keynesian and neo-classical analysis. This promoted many countries to impose interest rate ceilings at below market clearing levels.
Interest rate is a prominent feature of any economy. Interest rate change in response to a variety of economic events such as change in federal policy, crises in domestic and international financial market and changes in the prospects for long term economic growth and inflation. However, economic events such as these tend to be irregular (Keith, 1996).
Interest rate reform, a policy under financial sector liberalization, was to achieve efficiency in the financial sector and engendering financial deepening. In Nigeria, financial sector reforms began with the deregulation of interest rate in august 1987 (Ikhide and Alawode, 2001). Prior to this period, the financial system operated under financial regulation and interest rates were said to be repressed. According to McKinnon (1973) and Shaw (1973), financial repression arises mostly when a country imposes ceiling on deposit and lending nominal interest rates at a low level relative to inflation.
The resulting low or negative interest rates discouraged saving mobilization and channelling of the mobilized savings through the financial system. This has a negative impact on the quantity and quality of investment. Therefore, the expectation of interest rate reform was that it would encourage domestic savings and make loanable funds available in the banking institutions. But the criticism has been that the “tunnel-like” structure of interest rate (Ojo, 1976) in Nigeria is capable of discouraging savings and retarding investment.
CHAPTER TWO
2.0 Literature Review
2.1 Introduction
The review of relevant literature is the main topic of this chapter. A literature review covers theoretical and methodological contributions to a certain issue in addition to the state of knowledge at the time of writing. It provides information about the state of the art in relation to the subject you are writing about. It examines the body of work on the chosen subject. The literature evaluation in this study comprises the …
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TABLE OF CONTENTSPRELIMINARY PAGES
- Title page
- Approval page
- Dedication
- Acknowledgement
- Table of Contents
- Abstract
INTRODUCTION
- 1.1 Background …
- ⋮
LITERATURE REVIEW
- 2.1 Introduction
- 2.2 Conceptual Review
- 2.3 Theoretical Framework
- ⋮
- 2.4 Empirical Studies
- 2.5 Research Gaps
- 2.6 Summary of Literature Review
CHAPTER THREE
RESEARCH METHODOLOGY
- 3.1 Introduction
- 3.2 Research Design
- 3.3 Population of Study
- 3.4 Sampling and Sampling Technique
- 3.5 Validation of Research Instrument
- 3.6 Method of Data Collection
- 3.7 Method of Data Analysis
- 3.8 Questionnaire Administration
- 3.9 Ethical Consideration
- 3.10 Statistical Analysis
CHAPTER FOUR
DATA ANALYSIS, RESULT AND DISCUSSION
- 4.1 Introduction
- 4.2 Presentation and Analysis of Data
- 4.3 Re-statement of Research Questions
- 4.4 Test of Hypotheses
- 4.5 Discussion of Findings
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
- 5.1 Introduction
- 5.2 Summary of Findings
- 5.3 Conclusion
- 5.4 Recommendation
- 5.5 Suggestion for Further Study
REFERENCES
APPENDIX A - “QUESTIONNAIRE”
Disclaimer for Complete Material Utilization
The displayed research work titled "Effect of Interest Rate on Economic Growth in Nigeria" is stated as a research guideline towards accomplishing your assigned project / seminar research work. All the research materials on this website are ONLY for research purposes and should be used as a guideline in developing your research work. For no reason should you copy word for word as projectlist.com.ng will not be liable for any who copied the material. By ordering the complete research guideline, it signifies that you've accepted our terms of service.
PRELIMINARY PAGES
- Title page
- Approval page
- Dedication
- Acknowledgement
- Table of Contents
- Abstract
INTRODUCTION
- 1.1 Background …
- ⋮
LITERATURE REVIEW
- 2.1 Introduction
- 2.2 Conceptual Review
- 2.3 Theoretical Framework
- ⋮
- 2.4 Empirical Studies
- 2.5 Research Gaps
- 2.6 Summary of Literature Review
CHAPTER THREE
RESEARCH METHODOLOGY
- 3.1 Introduction
- 3.2 Research Design
- 3.3 Population of Study
- 3.4 Sampling and Sampling Technique
- 3.5 Validation of Research Instrument
- 3.6 Method of Data Collection
- 3.7 Method of Data Analysis
- 3.8 Questionnaire Administration
- 3.9 Ethical Consideration
- 3.10 Statistical Analysis
CHAPTER FOUR
DATA ANALYSIS, RESULT AND DISCUSSION
- 4.1 Introduction
- 4.2 Presentation and Analysis of Data
- 4.3 Re-statement of Research Questions
- 4.4 Test of Hypotheses
- 4.5 Discussion of Findings
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
- 5.1 Introduction
- 5.2 Summary of Findings
- 5.3 Conclusion
- 5.4 Recommendation
- 5.5 Suggestion for Further Study
REFERENCES
APPENDIX A - “QUESTIONNAIRE”
Disclaimer for Complete Material Utilization
The displayed research work titled "Effect of Interest Rate on Economic Growth in Nigeria" is stated as a research guideline towards accomplishing your assigned project / seminar research work. All the research materials on this website are ONLY for research purposes and should be used as a guideline in developing your research work. For no reason should you copy word for word as projectlist.com.ng will not be liable for any who copied the material. By ordering the complete research guideline, it signifies that you've accepted our terms of service.
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