THE CAPITAL MARKET AND ECONOMIC GROWTH IN NIGERIA
ABSTRACT
    The study examines the impact of capital market on economic growth in Nigeria, using annual data covering the period 1980 to 2009. The econometric technique of ordinary least squares (OLS) was used to analyze the data. Results from the analysis depicts that the total listed stocks in the market, value of traded stocks, government stocks have a very strong positive impact on economic growth in Nigeria while the aggregate level of capital market activities does not significantly affect economic growth in Nigeria.
Recommendation made was based on the premise that government through its different specialty departments should encourage savings and investments by putting in place appropriate policies which gives equal importance of both bank-based financial sector and market based stock market economy to enhance capital formation and investments.  
TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
1.1    Background of the Study                    
1.2    Statement of Problem                        
1.3    Objective of the Study                        
1.4    Research Hypotheses                        
1.5    Scope of the Study                        
1.6    Significance of the Study                    
1.7    Organization of the Study                    
CHAPTER TWO: LITERATURE REVIEW
2.1     Brief Overview of the Nigerian Capital Market    
2.2    The Concept and Structure of the     Nigerian Financial System   
2.2.1    The Regulatory Bodies/Authorities                
2.2.2    The Constituents/ Components of the     Market    
2.3    Functions and Instruments Traded in the Nigerian Capital Market                   
2.4    The Concept of Economic Growth                 
2.4.1    Basic Factors in The Growth Process            
2.5    The Role of Capital Market in Economic Growth and Development of Nigeria                       
 2.6    Gross Domestic Product (GDP)                                                   444            
2.7    Evidence from Sub-Saharan Africa                
2.8   Evidence from West Africa                    
2.9   Evidence from Nigeria                        
2.10    Theoretical Framework                    
CHAPTER THREE: METHODOLOGY OF THE STUDY
3.1    Introduction                             
3.2    Sources of Data                             
3.3    Model Specification                        
3.4     Method of Data Analysis                    
CHAPTER FOUR: EMPIRICAL ANALYSIS
4.1     Introduction                            
4.2     Correlation Analysis                        
4.3     Regression Analysis                        
CHAPTER FIVE: SUMMARY, RECOMMENDATIONS
            AND CONCLUSION
5.1     Summary of Findings                        
5.2     Policy Recommendations                    
5.3     Conclusion                                
    References                                
Appendices                            
CHAPTER ONE
INTRODUCTION
1.1    BACKGROUND OF THE STUDY
    Virtually all aspects of human endeavour entails the use of money either borrowed or self-generated. Money enhances capital accumulation with tremendous cyclical rebound on economic growth. In capital market, the stock in trade is money which could be raised through various means or instrument under a well governed rules and regulations carefully administered and where to by different market operators.
    It is true that the rate of economic growth of any country is in   centrically linked to the sophistication of its financial market and specifically its capital market. Virile financial market assists countries of the world to muster the needed financial resources and skills for growth. Equity markets in developing countries until the Mid 1980’s generally suffered form the cyclical defects of bank dominated economies that have shortages of equity capital, lack of liquidity absence of foreign institutional investors and lack of investors confidence in the stock market (Aillebiyi, 2005).
    Financial market and its sub-units capital market are constituted whenever participants with the aid of infrastructures, technology and other devices of facilitate the mobilization and channeling of foods into productive investment. Te importance of capital market lies in its financial intermediation capacity to link the deficit sector with the surplus sectors of the economy. The absence of such capacity robes the economy of investment and production of goods and services for societal advancement. Funds could thereby be like at one end while being sought out at  the other end in pursuit of socio-economic growth and development (Akinbohngbe, 1996).
    The knowledge that capital market can make a wealthy country and wealth people is the concept and belief this study portrays. Universally, capital market are primarily created to provide avenues for effective mobilization of idle funds from surplus economic unit and channeled into deficit units for long term investment purposes.
    The suppliers of funds are basically individuals and corporate bodies as government rarely supply funds to the market. The deficit unit in contrast of only corporate bodies and government. In other words, individuals (household) who are major suppliers of funds to the market are adjacent in the category of fund users.
    The following requirements of corporate bodies and government are often colossal sometimes running into billions of naira. It is therefore usually very different for these bodies to meet such funding requirements solely from internal sources (vol. 1, 4, No.12 international journal of business management 220).
Hence, the often look up to the capital market. This is because the capital market is the ideal source as it enables entities and government to pool monies from a large number of people and institution. Thus, the socio-economic function of the capital market is well established. It does not only encourage and mobilize savings but also efficiently allocates such savings to areas of new (Ekinel, 1996).
1.2    STATEMENT OF PROBLEM
    Levine and Serws (1996) postulated a strong positive relationship between capital market development and long run economics growth. Further studies showed that capital market liquidity plays a vital role in the process of socio-economic growth (Auyanwu, 1993) though there are other scholars who share contrary views about the performance of the capital market and its attendant effects an economic growth of a nation. Whichever schools thought whether for or against, capital market as a tool for economic growth depends on the situation a country is passing through and the prevailing economic indices/determinants.
    Given the role of capital market in the growth and development of any nation, this study hence, seeks to determine the impact of capital market on economic growth in Nigeria more specifically therefore, the study seeks to provide answer to the following research questions;
i)    Does market capital affect economic growth in Nigeria?
ii)    Does total listed companies affect economic growth in Nigeria?
iii)    Does value of traded stocks affect economic growth in Nigeria?
iv)    Does total new issues affect economic growth in Nigeria?
v)    Does total money supply affect economic growth in Nigeria?
vi)    Does a government stock affect economic growth in Nigeria?   
1.3    OBJECTIVE OF THE STUDY
    The objectives of the study are:
    To determine the impact of market capital, total listed companies, value of traded stocks, total new issues, total money supply and government stocks on economic growth in Nigeria.
1.4    RESEARCH HYPOTHESES
    Hypotheses of the study are;
i)    Ho:    Market capitalization does not affects economic growth in Nigeria.
Ha:    Market capitalization affects economic growth in Nigeria
ii)    Ho:    Number of listed companies does not affect economic growth in Nigeria.
Ha:    Number of listed companies affects economic growth in Nigeria.
iii)    Ho:    Total New issues does not affect economic growth in Nigeria
Ha:    Total New issues affect economic growth in Nigeria.
  1.5    SCOPE OF THE STUDY
    The research work is critically to examine the impact of capital market on economic growth in Nigeria and the work is listed to the activities and instruments of the operators of the Nigeria capital market to economic growth in Nigeria with a time series data from 1990-2009.
1.6    SIGNIFICANCE OF THE STUDY
    The findings of this study will be useful to those who seek for knowledge on how the Nigerian capital market is being regulated to ensure economic growth with the period under review.
    The study will save as a data base for further research to stakeholders like students of finance, policy makers, government, financial institutions, investors and potential investors, members of academia and researchers alike.
1.7    ORGANIZATION OF THE STUDY
    Chapter one of this study is the introduction consisting of background information, research problems, objectives, hypotheses to be tested, scope as well as significance of the study. Chapter two contains general review of relevant literature chapter three entails research methodology, chapter the contains summary of the findings, conclusion, and recommendations.