Effect Of Macroeconomic Variables On Manufacturing Sector Growth In Nigeria

ABSTRACT

The study investigated the effect of macroeconomic variables on manufacturing sector growth in Nigeria using time series data from 2001 to 2016. The dataset were sourced from Central Bank of Nigeria Statistical Bulletin 2016. The macroeconomic variables used as the independent variables were interest rate, inflation rate and money supply. Based on the analysis, it was found that inflation and interest rate had negative and insignificant effect on manufacturing sector growth in Nigeria, while money supply was positive and significant in affecting manufacturing sector growth in Nigeria. By these findings, it was revealed that money supply was the most significant macroeconomic variable in explaining the variations in manufacturing sector growth in Nigeria. Hence, it was recommended among other things that manufacturers should monitor the changes in macroeconomic variables when taking their business decisions.

TABLE OF CONTENTS

Title Page ﾿ i

Declaration ﾿ ii

Certification ﾿ iii

Dedication ﾿ iv

Acknowledgements ﾿ v

Table of Contents ﾿ vi

List of Tables ﾿ viii

Abstract ﾿ ix

CHAPTER ONE

Introduction ﾿ 1

1.1 ﾿ Background to the Study ﾿ 1

1.2 ﾿ Statement of Problem ﾿ 2

1.3 ﾿ Objectives of the Study ﾿ 4

1.4 ﾿ Research Questions ﾿ 5

1.5 ﾿ Research Hypotheses ﾿ 5

1.6 ﾿ Scope of the Study ﾿ 5

1.7 ﾿ Limitation to the Study ﾿ 6

1.8 ﾿ Significance of the Study  ﾿ 6

CHAPTER TWO

Literature Review ﾿ 8 

2.1 ﾿ Conceptual Framework ﾿ 8

2.1.1 ﾿ Manufacturing Sector Growth and Foreign Direct Investment ﾿ 10

2.1.2 ﾿ Manufacturing Sector Growth and Exchange Rate ﾿ 10

2.1.3 ﾿ Manufacturing Sector Growth and Inflation (Consumer Price Index) ﾿ 12

2.1.4 ﾿ Manufacturing Sector Growth and Broad Money Supply ﾿ 12

2.1.5 ﾿ Manufacturing Sector Growth in Nigeria ﾿ 14 

2.2 ﾿ Concept of Productivity ﾿ 19

2.3 ﾿ Theoretical Framework ﾿ 27

2.3.1 ﾿ Quantity Theory of Money ﾿ 28

2.3.2 ﾿ Keynesian Theory ﾿ 28

2.3.3 ﾿ Monetarism ﾿ 29

2.3.4 ﾿ Structuralism ﾿ 30

2.3.5 ﾿ The Classical Theory ﾿ 30

2.4 ﾿ Empirical Review ﾿ 31

CHAPTER THREE

Methodology ﾿ 35

3.1 ﾿ Research design ﾿ 35

3.2 ﾿ Area of Study ﾿ 35

3.3 ﾿ Types and Sources of Data ﾿ 35

3.4 ﾿ Validity and Reliability of the Instrument ﾿ 36

3.5 ﾿ Analytical Techniques ﾿ 36

3.6 ﾿ Model Specification ﾿ 36

3.6.1 ﾿ Independent variables ﾿ 37

3.6.2 ﾿ Dependent Variable ﾿ 37

CHAPTER FOUR

Presentation of Data, Analysis and Discussion ﾿ 38

4.1 ﾿ Presentation of Data ﾿ 38

4.2 ﾿ Data Analysis and Discussion of Results ﾿ 38

4.2.1 ﾿ Descriptive Statistic ﾿ 39

4.2.2 ﾿ Regression Analysis ﾿ 39

4.2.2.1 ﾿ Discussion of Results and Hypotheses Testing ﾿ 41

CHAPTER FIVE

Summary of Findings, Conclusion and Recommendations ﾿ 43

5.1 ﾿ Summary of Findings ﾿ 43

5.2 ﾿ Conclusion ﾿ 43

5.3 ﾿ Recommendations ﾿ 43

References 

Appendix