Ayodeji, Emmanuel A., PhD Affiliation
    ; Ajala, Rosemary Bukola Affiliation


The study examined the contributions of capital market performance to economic growth in Nige-ria;essentially, it was anchored on endogenous growth theory. Time-series data, covering 1984 to 2016, were sourced from the capital market bulletins of the Nigerian Securities and Exchange Commission and the statistical bulletins of the Central Bank of Nigeria. From these records, economic growth was proxied by gross domestic product, while capital market performance indicators employed are mar-ket capitalisation, all-share index, number of listed equities, number of deals, value of deals, value of transactions, and stock market turnover. Ordinary Least Squares (OLS) was the major estimation technique employed; however, for robustness, Auto Regressive Distributed Lag (ARDL) coeÿcients and Vector Auto Regression (VAR) coeÿcients were used to confirm the OLS results. It was found that, three capital market performance indicators (market capitalization, number of listed equities, and value of transactions) positively contributed to economic growth in Nigeria; and four others (stock mar-ket turnover, all-share index, number of deals, and value of deals) negatively contributed to economic growth in Nigeria. Therefore, the study concluded that, capital market performance could contribute positively or negatively to economic growth in Nigeria. So, to this extent, capital market performance has heterogeneous e˙ects on economic growth, depending on the level ofeÿciency and discipline of the market as well as the conduciveness of the macroeconomic environment. This poses a resolution to the conflict between the positive-linkand the negative-link schools. It was therefore recommended, that, capital market deregulation policy should be pursued by the national government to influence positive all-share index. Also, capital market regulators should instil market discipline to discourage market infractions, and restore investors’ confidence for increased activities of the capital market, thus leading to improved stock market turnover.Not only that, government should make the macroeconomic envi-ronment conducive by putting inflation rate, exchange rate, tax rate and interest rates under check, so that both the number and value of deals can be enhanced.

Keywords: Capital market, economic growth, endogenous growth, market turnover