Project Abstract

This study aims to investigate the determinants of investment in Nigeria from 1985 to 2011. Investment plays a crucial role in the economic development of any country, and understanding the factors that influence investment decisions is essential for policymakers and investors. The research will focus on both macroeconomic and institutional determinants of investment in Nigeria over a 26-year period. The macroeconomic determinants to be examined include GDP growth rate, inflation rate, interest rate, exchange rate, and government expenditure. These variables are important indicators of the overall economic environment and can significantly impact investment decisions. For instance, a higher GDP growth rate is generally associated with increased investment opportunities, while high inflation rates may erode the real returns on investments. In addition to macroeconomic factors, institutional determinants such as political stability, regulatory quality, rule of law, and corruption will also be analyzed. These institutional factors are crucial in shaping the investment climate of a country and can influence the level of investor confidence. For example, a stable political environment is often seen as conducive to long-term investments, while high levels of corruption can deter investors from committing their capital. The study will utilize a panel data regression analysis to examine the relationship between the determinants and investment levels in Nigeria. By employing panel data techniques, the research will be able to control for individual heterogeneity and time-specific effects, providing more robust and reliable results. The findings of this study are expected to provide valuable insights for policymakers, investors, and researchers interested in understanding the dynamics of investment in Nigeria. By identifying the key determinants of investment, the research can help guide policy interventions aimed at promoting higher levels of investment in the country. Moreover, the study can contribute to the existing literature on investment determinants in developing countries, particularly in the context of Nigeria. Overall, this research project seeks to shed light on the factors driving investment decisions in Nigeria and contribute to the broader discussion on economic development and growth. By examining both macroeconomic and institutional determinants, the study aims to offer a comprehensive analysis of the investment climate in Nigeria and provide evidence-based recommendations for policymakers and investors.

Project Overview