• Tagher AJEKWE
  • JohnMark KORNA


Capital Market Development, Economic Growth, Nigeria


This paper examined the effects of capital market development on economic growth in Nigeria. The objectives of the study were to: examine the effect capital market development on market capitalization (Mcap); to examine the effect capital market development have on total value of Stock (TVS); to examine the effect of capital market development on All Share Index, (ASI) and; to examine the effect of capital market reforms on number of deals (i.e number of deals on the stock exchange). Time series data for the period 2000 – 2020 from the Central Bank of Nigeria Statistical Bulletin (2020) were used. The study employed Multiple Regression analysis via the use of Econometric-views (E-views) 10.0, to analyse the data. In the analysis, economic growth was proxied by gross domestic product (GDP) and the market capitalization (Mcap) total value of stock (TVS), number of deals (ND) and All Share Index (ASI) were the indices (variables) used to gauge the effect of the capital market development vis-à-vis economic growth. The results showed a positive (though not significant) relationship between MCAP, TVS, ASI and economic growth (GDP). The results have also shown a negative relationship between ND and economic growth (GDP). The study concluded that there existed both a positive and a negative relationship between the capital market reforms and economic growth during the period between 2000 –2020. The study recommended the need to encourage foreign investors to participate in the capital market to boost its activities, and the need to ensure investor confidence and protection among others as a way of boosting activities on the capital market. The implication of the study will hopefully draw the attention of policy makers to the need to ensure the efficient functioning of the capital market through reforms and regulation to position it for its key role of funds mobilization and distribution in an economy.