- The Complete Research Material is averagely 56 pages long and it is in Ms Word Format, it has 1-5 Chapters.
- Major Attributes are Abstract, All Chapters, Figures, Appendix, References.
- Study Level: BTech, BSc, BEng, BA, HND, ND or NCE.
- Full Access Fee: ₦6,000
Get the complete project »
ABSTRACT
This Research study was carried out to find the link between financial sector liberalization and capital market Development. As part of the Structural Adjustment Programme (SAP) of 1986, the Nigerian Government initiated a large scale restructuring
Of the financial sector and the liberalization of the regulations concerning financial institutions and markets. This was justified on the basis of existing market failures which
arose from externalities and lack of information
Using the econometric techniques, we found, that financial liberalization increased the real deposit ratio and also will lead to a substitution into financial asset resulting in a greater supply credit to finance real investment for capital market development and economic growth. Consequently, we recommend that for macroeconomic stability, efficiency and proper development of the financial system, direct control should be discouraged while indirect control should be encouraged through the market mechanism.
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Just like other African Economies, Nigeria’s financial sector is underdeveloped and unorganized. It is characterized by dualism, market segmentation and spatial fragmentation [Iyoha, 2002]. Financial sector facilitates the conduct of trade transactions, the efficient use of financial resources, mobilization of savings and risk taking which are central to sustained Economic Growth and Development.
According to T.W. Oshikoya and Osita Ogbu [1995], financial liberalization in several African countries has been implemented largely through Structural Adjustment Programs. In Nigeria, until the adoption of structural adjustment program in 1986, financial repression and bureaucratic control of interest rates were the order of the day.
Economic Development creates demands for particular types of financial arrangements and the financial system responds automatically to these demands. Finance, is argued to act as a catalyst in the process of Development but if repressed could become fetters or obstacles to the Growth process [Ikhide, 1997].
Even though the money and capital markets in Nigeria are not as deep as desirable, a start seems to have been made in the late 1980s and early 1990s to develop a more robust and balanced financial structure that would improve the ability of the domestic financial system to mobilize savings and contribute to self sustained Economic Growth [Iyoha, 2002].
The objectives of the liberalization are to build more efficient, robust and deeper financial systems, which can support the growth of private sector enterprise. Efficiency entails two components; which are improved credit allocation and more or higher quality financial services for a given level of inputs [Brown Bridge and Gayi, 2001].
The role played by the financial sector is an Economy can be important in determining Economic Growth. A growing empirical literature demonstrates that the Development of the financial system has positive effects on the long run rate of Economic Growth and the volume and efficiency of investment [Fry, 1995 Philip Arestis et al, 2002], through the removal of the elements of financial repression, particularly controlled interest rates, financial sector liberalization is expected to lead to higher nominal and real interest rate [Emenuga, 2001].
The capital market is divided into two segments: the primary market where companies’ shares are issued for the first time before being quoted on the stock exchange and secondary market where is trading is done in existing stocks. The capital market has served as a source of long- term fund to finance investment in the private sector of the Nigerian Economy.
The liberalization of the financial sector involved liberalization of interest rates, promotion of market based system of credit allocation and enhancing completion and efficiency of the regulatory and supervisory framework [Ikhide, 1997]
1.2 STATEMENT OF PROBLEM
This study attempts to examine the extent to which the liberalization policy has resolve the problems existing in the system which are direct controls, the pervasive Government intervention in the financial system and the resultant stifling of competition and resource misallocation.
This study attempts to find out the extent to which the liberalization policy has resolve the problem of externalities, which relates to the distortions caused by high and volatile inflation.
This study is concerned with the impact of the liberalization policy on the information problems, which is in the form of informational asymmetries between the suppliers and uses of financial services.
1.3 SCOPE OF THE STUDY
This study will undertake an analysis of the financial liberalization policy with a view to identifying the reason that led to the adoption of the policy. The focus will be on measuring the influence and effects of financial sector liberalization on some capital market Development indicators as far as the availability of Data permits. The period of the study is from 1970- 2004 in order to carry out a trend analysis on the before the liberalization period [1970 – 1985] and after the liberalization [1986 – 2004].
1.4 JUSTIFICATION OF THE STUDY
Financial sector reforms in Nigeria has embraced a number of policies designed to increase the size, improve the efficiency and raised the diversity of the financial system. This goal is achieved through financial liberalization which is viewed as the process of moving towards market- determined prices on all classes of financial products, characterized by symmetric entry and exit conditions to all participants increasing internationalization as represented by the opening up of domestic markets to international competition [Ikhide, Yinusa, 1998].
The liberalization of financial institutions and markets is an improvement in financial intermediation, which is considered a necessary condition for stimulating investment, raising productive capacity and fostering Economic Growth and Development.
1.5 OBJECTIVES OF THE STUDY
The general objective of this study is to determine the extent to which financial liberalization have led to the development of the capital market in Nigeria. To achieve this general objective, the following specific objectives will be examined.
1. To provide a comprehensive insight into the structure of the capital market in Nigeria.
2. To examine the impacts of liberalization on the Development of the capital market.
3. To access the impact of reform policies like debt conversion programs.
1.6 RESEARCH QUESTIONS
This study will be based on the following Research Questions:
1. Has the financial sector liberalization measures been effective in achieveing its stated objectives?
2. Has the financial sector liberalization measures been able to solve the repressed nature of the Nigerian capital market?
3. Has financial sector liberalization measures improved the efficiency in resource allocation and quality of investment in Nigeria?
1.7 RESEARCH HYPOTHESIS
Ho: financial sector liberalization does not have a positive impact on capital market
Development.
Hi: financial sector liberalization does have a positive impact on capital market Development.
Ho: capital market development does not have a positive impact on Economic Growth.
Hi: capital market developments do have a positive impact on Economic Growth.
1.8 METHODOLOGY OF THE STUDY
The study will adopt Econometrics techniques to estimate the Models. We will use the Ordinary Least Squares (OLS) method of estimation and the Cochrane- orcutt correction method.
1.9 SOURCES OF DATA
The Data used for this study are obtained essentially from the publication Central Bank of Nigeria statistical bulletin and Central Bank of Nigeria Annual Statement of Accounts. Others may be obtained from Nigeria Stock Exchange and other International Economic Journals.
1.10. OUTLINE OF PROPOSED CHAPTERS
The final report will be organized into five chapters.
Chapter 1 Introduction.
Chapter 2 Literature Review
Chapter 3. Theoretical framework and Research Methodology for the Study.
Chapter 4. Data Analysis and Interpretation Empirical Result.
Chapter 5. Summary, Policy Recommendation and Conclusion.
You either get what you want or your money back. T&C Apply
You can find more project topics easily, just search
-
SIMILAR ECONOMICS FINAL YEAR PROJECT RESEARCH TOPICS
-
1. THE IMPACT OF FISCAL POLICIES IN STABILIZATION OF THE NIGERIAN ECONOMY
» CHAPTER ONE INTRODUCTION 1.1 BACKGROUND TO THE STUDY The growth and stabilization of the Nigerian economy has not been stable over the years as a resu...Continue Reading »Item Type & Format: Project Material - Ms Word | 55 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
2. FAILURE OF SMALL SCALE BUSINESS IN NIGERIA CAUSES AND SOLUTIONS
» CHAPTER ONE INTRODUCTION 1.1 Background of the study The Small and medium sized enterprises (SMEs) are the backbone of virtually all economies of the ...Continue Reading »Item Type & Format: Project Material - Ms Word | 85 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
3. MONETARY POLICY AND ECONOMIC GROWTH. AN EMPIRICAL EVIDENCE FROM NIGERIA (1980-2014)
» ABSTRACT One can hardly find a country without monetary policy. As a matter of fact, monetary policy has gained a solid ground in the Nigerian economy...Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
4. THE IMPACT OF RISK MANAGEMENT ON PROFITABILITY OF GT BANK PLC, MURTALA MOHAMMED SQUARE BRANCH KADUNA
» CHAPTER ONE INTRODUCTION 1.1 Background of the Study Risk Management is the identification assessment and prioritization of risks. It is the effect of...Continue Reading »Item Type & Format: Project Material - Ms Word | 66 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
5. TAXATION AS A TOOL FOR ECONOMIC DEVELOPMENT IN NIGERIA
» CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY Nigeria as a nation has the vision of becoming one among the world’s 20 largest economies i...Continue Reading »Item Type & Format: Project Material - Ms Word | 59 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
6. IMPACT OF PRICING POLICY ON PROFITABILITY LEVEL OF AN ORGANIZATION
» CHAPTER ONE INTRODUCTION 1.1 BACK GROUND OF STUDY One of the most crucial operating decisions management must make is establishing a setting price for...Continue Reading »Item Type & Format: Project Material - Ms Word | 61 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
7. IMPACT OF INFORMATION COMMUNICATION TECHNOLOGY ON THE DEVELOPMENT OF RURAL AREA IN NIGERIA
» ABSTRACT Information Communication Technology (ICT) has the potential to contribute to development, especially in rural areas of developing countries....Continue Reading »Item Type & Format: Project Material - Ms Word | 52 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
8. PRIVATE SECTOR ACCESS TO CREDIT AND MANUFACTURING OUTPUT IN NIGERIA
» CHAPTER ONE INTRODUCTION 1.0 Background to the study Over the years, oil and agriculture have been the major sources of Nigerian revenue with greater ...Continue Reading »Item Type & Format: Project Material - Ms Word | 183 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
9. THE RELATIONSHIP BETWEEN REMITTANCE NET FLOWS AND ECONOMIC GROWTH IN NIGERIA
» CHAPTER ONE 1.1 Background to the Study Migration has become an important strategy for household subsistence. Through migration, households have boost...Continue Reading »Item Type & Format: Project Material - Ms Word | 101 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT
-
10. THE IMPACT OF TAXATION ON ECONOMIC DEVELOPMENT IN NIGERIA (2003 - 2012)
» ABSTRACT The purpose of this study is to find out if actually there is an impact of taxation as aid to economic development and my study is based on t...Continue Reading »Item Type & Format: Project Material - Ms Word | 86 pages | Instant Download | Chapter 1-5 | ECONOMICS DEPARTMENT