Pages: (1-23 )
Abstract
effect but exert a significant positive long run influence, and conversely, broad money supply and stock market liquidity were found to be statistically insignificant in both timeframes, leading to the conclusion that the Nigerian economy lacks sufficient support from its financial market and underscoring the need for targeted reforms, recommends that as the study policymakers implement regulatory frameworks aimed at Abstract Nigeria’s persistent struggle with sustainable economic growth, despite its abundant natural resources, has drawn attention to the underperformance of its financial sector, and this study examines the role of stock market development in fostering economic growth in Nigeria using secondary data spanning from 1990 to 2023, employing an ex post facto research design, with market capitalization, credit to the private sector, broad money supply, interest rate, and stock market liquidity serving as proxies for financial market development, while economic growth is measured by the annual growth rate of gross domestic product; following unit root testing, which indicated mixed integration orders at levels I(0) and first differences I(1), the autoregressive distributed lag (ARDL) model was utilized to estimate both short run and long-run relationships at a 5% level of significance, and results reveal that market capitalization significantly enhances economic growth in both the short and long run, credit to the private sector exhibits no significant impact in the short run but demonstrates a significant negative influence in the long run, interest rates show no short-run 67 boosting investor confidence and participation in the stock market to improve equity financing and support sustainable economic development.
Keywords: Autoregressive Distributed Lag, credit to the private sector, economic growth, financial market development, stock market liquidity,