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VOL. 3, ISSUE 2 (2021)
Financial system development and poverty in Nigeria
Authors
Nye Oruwari
Abstract
The study examined financial system development and poverty as major economic development policies in countries especially the Nigeria’s case. The study give answers to the above employing econometric methods of Augmented Dickey further, Philip-Person and Elliott Rothenberg and stock unit root test techniques for testing of stationary of the variables in the model. In addition, auto regressive distributed lag bound test for co-integration and error correction model are adopted. In this regard the study makes use of rate of poverty as proxy for dependent variable and broad money supply to the ratio of gross domestic credit to private sector to gross domestic ratio, liquid liabilities and interest rate spread as proxies for financial system development as independent variables. The result indicates a long-run and short-run relationship between financial system development and poverty in Nigeria. The result also shows that bread money supply to gross domestic product ratio has a negative and insignificant impact on poverty in the long-run in Nigeria. Again, there is a negative and insignificant impact on poverty in the short-run in Nigeria. It also shows that credit to private sector to gross domestic product ratio has a negative and insignificant impact on poverty in the short-run. Liquid liability has positive and insignificant impact on poverty in the short-run in Nigeria. Interest rate spread has a positive and insignificant impact on poverty in Nigeria, in the long-run and short-run respectively. The study recommends that financial system regulatory authority has to liberalize the financial system basically the banking sub-sector as to expand the source of financial deposits and also to encourage competitiveness within the spread in the system and also that the monetary authority need to formulate favourable policy for the real poor to have access to financial system without with stringent collaterals.
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Pages:49-58
How to cite this article:
Nye Oruwari "Financial system development and poverty in Nigeria ". International Journal of Social Research and Development, Vol 3, Issue 2, 2021, Pages 49-58
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