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. 1 No.8 2015

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Domestic Debt and Real Sector Growth: A Var Approach.

Ogunbiyi, Sunday Samuel Ph.D, Okunlola, Funso Abiodun

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Abstract

This paper takes a look at whether domestic debt impact real sector growth in Nigeria with particular emphasis on the agriculture and industry sector growth. Our study likewise looked at a ten (10) month period forecast using the IRF. To achieve our objective, Agriculture growth was proxied by Agric GDP while industry growth proxied by industry GDP. Time series data covering a period of 33 years (1980 – 2013) was used. Data sets were source from the Central Bank of Nigeria economic reports and statistical bulletin of various issues, National Bureau of Statistics, Debt Management Office of the Federation and Federal Ministry of Finance. The descriptive statistics – Skewness, Kurtosis and Jarque-Bera statistics were analysed. The ADF unit root, and Vector Autoregression(VAR) analysis technique was also employed in our estimation. Similarly, the three approaches to estimating VAR - Granger Causality and the Impulse Response Function (IRF) were equally analyzed. The study concludes based on the findings that in an advent of consistency and project tied borrowing, real sector will experience growth and development

keywords:

Domestic Debt, Real Sector, Impulse Response Function – IRF

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