IIARD International Institute of Academic Research and Development

IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH (IJBFR )

E-ISSN 2695-1886
P-ISSN 2672-4979
VOL. 2 NO. 1 2016

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Impact of Broad Money Supply on Nigerian Economic Growth

Chude, Nkiru Patricia

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Abstract

Regarding the fact that money supply and gross domestic product are closely related, this study investigated the relationship between money supply and economic growth in Nigeria adopting ordinary least squares(OLS) technique and also using data obtained from the central bank of Nigeria for the periods 1987 to 2010. To do so, employing other confirmatory quantitative tests like unit root Augmented Dickey Fuller (ADF) test and KPSS, VAR Granger causality test and co-integration, we found that there is a positive and significant relationship between money supply and economic growth in Nigeria. This implies that M2 has dominant influence on output and prices.

keywords:

Money Supply, Economic Growth, Financial Development, Interest Rate.

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