An Evaluation of The Effect of The Nigerian Capital Market on Industrial Development of Nigeria (1986-2017)

ABSTRACT         

The study assesses the Effect of the Nigerian Capital market on Industrial development (1986-2017).The Industrial development by data manufacturing sector and the capital market variables considered includes: Market Capitalization (MCAP), Volume of Shares (VOS) and All Shares Index (ASI). Applying Ordinary Least Square (OLS), Unit root test and Johansen co-integration, the model was estimated using Eview software. The estimated model revealed that there is a significant relationship between the explanatory variables (All share Index, Market Capitalization, Volume of shares) and Industrial development. This implies that there is a long run relationship between the capital market and Industrial development. The result further showed that only market capitalization is positively significant while Volume of Shares and All Share index were positive but insignificant. This helps us to adduce that market capitalization exerts more influence on industrial development than any variable from the capital market. Therefore it was concluded that the capital market contributes in no small measure to the development of Nigeria, hence it would be worthy that the government should among other restore confidence, formulate policies that would attract both Local and Foreign direct investment.