FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN NIGERIA

Abstract

The study evaluated the nature and impact of Foreign Direct Investment on Nigerian economic growth, between the periods of 1981 to 2017. Using time series data, econometric techniques like ADF Unit Root Test, Granger Causality test and ARDL Bound test were employed. It was found that there is a long run, though negative, relationship between FDI and economic growth in Nigeria, and that FDI unidirectional granger causes economic growth. The study concluded that there is a long run and negative relationship between FDI and economic growth in Nigeria. The study therefore recommends that government provide a sound macroeconomic policy that ensures proper utilization of foreign direct investment, in addition to comprehensive adjustment of macroeconomic policies to achieve and maximize the expected positive impact of FDI on Nigerian economic growth.