ABSTRACT
This research was designed to investigate the impact of fiscal policy and asset prices; an empirical investigation. A time series data of the all share price index as proxy for asset prices and the various sectoral expenditure on agriculture, education, transport/communication and the government recurrent and capital expenditures from 1985-2014 were sourced from secondary sources and was subjected to a multi regression analysis using the ordinary least square (OLS) estimator at 5% level of significance with the all share price index as the dependent variable. The results from the analysis showed that there exists a positive and statistically significant relationship between government expenditure on education and government recurrent expenditure and asset prices; that government expenditure on agriculture has a negative relationship but not statistically significant with asset prices, and that there exists a positive relationship between governments spending on transport/communication and total government capital expenditures and asset prices but also not statistically significant and this findings is in line with other empirical studies such as Ardagna (2009), Fransisco and Alexander (2011); Luca and Richardo (2011) etc. The study therefore recommended that, Special attention should be given to the agricultural sector to ensure that funds disbursed from government purse are well managed and used for profitable ventures and that agriculturists should be trained to understand the benefits of the stock market and thus, they should be sensitized to invest in the stock market.
TABLE OF CONTENTS
Title Page i
Declaration ii
Certification iii
Dedication iv
Acknowledgment v
Abstract vi
Table of Contents vii
CHAPTER ONE
INTRODUCTION
1.1 Background to the Study 1
1.2 Statement of Problem 5
1.3 Objective of the Study 7
1.4 Research Question 8
1.5 Research Hypothesis 9
1.6 Significance of 10
1.7 Scope of the Study 11
1.8 Limitation of the Study 12
1.9 Definition of Terms 13
1.10Organization of the Study 14
References 16
CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.1 Theoretical Framework 18
2.1.1 Theories of Asset Pricing 18
2.1.2 Theories of fiscal policy 23
2.1.3 Theories of government expenditures 25
2.2 Conceptual Framework 28
2.2.1 Link between Fiscal Policy and Asset Prices 28
2.2.2 Concept of Fiscal Policy 30
2.2.3 Government Spending 31
2.2.4 Taxation 32
2.2.5 Fiscal Policy in Nigeria 34
2.2.6 Asset Pricing 36
2.3 Empirical Review 37
2.4 Gap in Literature 42
References 44
CHAPTER THREE
RESEARCH METHODOLOGY
3.0 Introduction 48
3.1 Research Design 48
3.2 Population of the Study 49
3.3 Sample Size 49
3.4 Data Collection Techniques 49
3.5 Operational Measures of Variables 50
3.6 Model Specification 51
3.6 Method of Data Analysis 53
3.7 Justification of the Model 54
References 55
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
4.1 Introduction 56
4.2 Data Presentation 56
4.3 Presentation of Result and Interpretation 57
4.3.1 Presentation Result 1 61
4.3.2 Discussion of Findings 58
4.3.3 Presentation of Result 2 60
4.3.4Discussion of Finding 61
4.4 Hypothesis Testing 62
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATION
5.1 Summary of Findings 65
5.2 Conclusion 66
5.3 Recommendations 68
Bibliography 69
Appendices 70
