Stock Market Development and Welfare in Nigeria: A VECM Approach

Ademola, J. Osundina, Kemisola, C. Osundina


This study examined both long run and short run causality between stock market development and welfare in Nigeria. The indicators of stock market development were; market capitalization (CAP) and All Share Index (ASI) while the indicator for welfare was Human Development Index (HDI). Time series data for 34 years (1980 - 2014) were used. The variables were stationary at first difference I(1) which necessitate the use of Johansen co-integration test. Vector Error Correction Models (VECM) was used. The study found out that there was a long run causality running from stock market development to welfare in Nigeria with the speed of adjustment of about three years. The results of Wald test showed that short run causality runs from market capitalization to welfare and short run causality runs from All Share Index to welfare in Nigeria. We therefore recommended that policy makers should take note of the speed of adjustment in making policies relating to stock market in Nigeria in order to achieve improved welfare of Nigerians.

Keywords:  Nigerian Stock Market, Welfare, VECM, Market Capitalization

Full Text: PDF
Download the IISTE publication guideline!

To list your conference here. Please contact the administrator of this platform.

Paper submission email:

ISSN (Paper)2222-1697 ISSN (Online)2222-2847

Please add our address "" into your email contact list.

This journal follows ISO 9001 management standard and licensed under a Creative Commons Attribution 3.0 License.

Copyright ©