Foreign Direct Investment, Electricity Power Supply and Economic Growth in Nigeria

Sherifatu O. Onayemi, Philip A. Olomola, Philip O. Alege, Oluwakemi O. Onayemi

Abstract


This study examined the stimulation of foreign direct investment (FDI) inflows through constant electricity power supply for economic growth in Nigeria, by engaging time series data sourced from the world development indicators (WDI) for the period 1986 -2017 and employed the Autoregressive distribution lag econometric approach to co-integration. The gross domestic product growth rate per capita was the proxy for economic growth and the dependent variable, while the independent variables include foreign direct investment, labour force participation rate, gross fixed capital formation and electricity power supply. The result from the study showed that, in the long-run, increased FDI inflows, gross fixed capital formation, electricity power supply, have the potency of increasing economic growth by 30 per cent, 20 per cent and 6 per cent, respectively. Therefore, based on the results obtained, the study recommended that there should be constant electricity power supply to keep pace with productivity for efficient economic growth in Nigeria.

Keywords: Economic Growth, Electricity Power, Foreign Direct Investment

JEL Classifications: O47, L94, H54

DOI: https://doi.org/10.32479/ijeep.7774


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