📖 ABSTRACT/OVERVIEW
The relationship between stock market development and economic growth has been extensively theorised but requires country-specific empirical validation, particularly in the context of Nigeria's evolving capital market. This study assesses the relationship between stock market development and economic growth in Nigeria for the period 2000 to 2022. Secondary data were sourced from the Nigerian Exchange Group and the Central Bank of Nigeria Statistical Bulletin. Stock market development was measured by market capitalisation-to-GDP ratio, total value of shares traded, and stock market turnover ratio. Economic growth was measured by real GDP growth rate. Johansen cointegration analysis and ordinary least squares regression were employed. Results showed a significant positive long-run relationship between market capitalisation-to-GDP ratio and economic growth (coefficient = 0.27, p < 0.05). Total value of shares traded also had a significant positive relationship with GDP growth, while stock market turnover ratio had a weaker but positive effect. The cointegration result confirmed a stable long-run equilibrium between stock market development and growth. The study concludes that stock market development positively promotes economic growth in Nigeria, supporting the finance-led growth hypothesis. It recommends policies to deepen market liquidity, broaden the investor base, and improve market regulation to enhance the growth-promoting role of the Nigerian Exchange Group. Keywords: stock market development, economic growth, Nigerian Exchange Group, market capitalisation, finance-led growth
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