Financial liberalization, currency substitution and savings in Nigeria: Evidence from cointegration and error correction modeling
South African Journal of Economic and Management Sciences
| Field | Value | |
| Title | Financial liberalization, currency substitution and savings in Nigeria: Evidence from cointegration and error correction modeling | |
| Creator | Aziakpono, M B-Obasa, S | |
| Description | The study set out to test the McKinnon-Shaw proposition that financial liberalization will significantly increase savings mobilization. The results partly supported the financial liberalization proposition. Variables that capture the effects of currency substitution such as the interest rate differential, a proxy for underground economy, the inflation differential (as a measure of macroeconomic instability) and a dummy for political instability were significant in their adverse impacts on the saving mobilization process in Nigeria. We, therefore, advocate for an active monetary policy that will help manage the delicate balance between domestic and foreign interest rates. This should be combined with macroeconomic policies that create a stable economic environment along with appropriate financial and exchange rate policies, in order to discourage economic agents from preferring foreign denominated assets to those held in the domestic currency. | |
| Publisher | AOSIS Publishing | |
| Date | 2004-04-28 | |
| Identifier | 10.4102/sajems.v7i2.1381 | |
| Source | South African Journal of Economic and Management Sciences; Vol 7, No 2 (2004); 316-340 2222-3436 1015-8812 | |
| Language | eng | |
| Relation |
The following web links (URLs) may trigger a file download or direct you to an alternative webpage to gain access to a publication file format of the published article:
https://sajems.org/index.php/sajems/article/view/1381/529
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