Government expenditure on key sectors of the economy and stock market performance in Nigeria

Q3 Business, Management and Accounting

International Journal of Management and Enterprise Development Pub Date : 2023-03-01 DOI:10.20414/jed.v5i2.6736

Osagie Osifo, S. Abusomwan

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Abstract

Purpose — This study examines the effect of Government Expenditure (GE) on key sectors of the economy and Stock Market Performance (SMP) in Nigeria.Method — Statistics Bulletin published by the Central Bank of Nigeria (CBN) was utilized as source for time series data between 1980 and 2021. SMP is proxied with MCAP and ASI while expenditure on agriculture, defense, education, and health formed components of government expenditure. The FM-OLS and ARDL methodology were adopted to determine the GE's short and long-term impact on SMP in Nigeria. ADF unit root testing, correlation analysis, Engle and Granger co-integration analysis, and preliminary descriptive statistics testing were all carried out.Result — The outcome indicates that all through the long and short term, GE on education, defense and agriculture have significant influence of SMP in the long run via MCAP channel. GE on defense and agriculture significantly affects SMP in the short run via ASI channel. Hence, this study concludes that GE components are key determinants in explaining the effect of government spending on SMP in Nigeria. The magnitude of this effect is a function of stock market proxy used.Contribution — This study provides empirical evidence on the impact of government spending on key sectors of the economy on stock market performance in Nigeria using two proxies (market capitalization and all share index) in short run and longrun.

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尼日利亚主要经济部门的政府支出和股票市场表现

目的-本研究考察了尼日利亚政府支出(GE)对关键经济部门和股票市场表现(SMP)的影响。方法:采用尼日利亚中央银行(CBN)发布的《统计公报》作为1980年至2021年时间序列数据的来源。SMP与MCAP和ASI相辅相成，而农业、国防、教育和卫生支出构成政府支出的组成部分。采用FM-OLS和ARDL方法来确定GE对尼日利亚SMP的短期和长期影响。ADF单位根检验、相关分析、Engle和Granger协整分析和初步描述性统计检验。结果-结果表明，从长期和短期来看，GE在教育、国防和农业方面都通过MCAP渠道对SMP产生了显著的长期影响。通用电气在国防和农业方面通过ASI渠道在短期内显著影响SMP。因此，本研究得出结论，GE组件是解释尼日利亚政府支出对SMP影响的关键决定因素。这种影响的大小是股票市场代理使用的函数。贡献——本研究利用短期和长期两个代理指标(市值和所有股票指数)，就尼日利亚关键经济部门的政府支出对股市表现的影响提供了实证证据。

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来源期刊

International Journal of Management and Enterprise Development Business, Management and Accounting-Business and International Management

CiteScore

1.80

自引率

0.00%

发文量

期刊介绍： IJMED is a major international research journal dedicated to business development strategy and entrepreneurship policy as well as management processes in an international and cross-cultural context. IJMED provides a venue for high quality papers including theoretical research articles, evidence-based case studies and practical applications seeking to explore best practice and investigate strategies for rapid growth management in SMEs. IJMED has a history of contributing to the academic literature, providing conceptual and practical insights and generating innovative ideas for organizational enterprise. Topics covered include: -SMEs'' start-up development, corporate venturing- Technological opportunities, new firm creation, valuation- Technological adoption, technology transfer, technopreneurship- Joint ventures/alliances, franchising and corporate ownership- Business incubator development strategy- Economic and social entrepreneurship- Virtual coaching services for SMEs- SMEs and entrepreneurship policy- Start-up cognitions/behaviours- Halo effect, technology licensing- Long-run technology investments- Knowledge management/technology strategy in SMEs- Managing rapid growth, accelerating competitive effectiveness- Strategy decision speed and SME performance- Entrepreneurs in non-profit sector.