Foreign Direct Investment and Employment Creation in Nigeria

Kehinde Banjo Aladelusi, Habeeb Olaniyi Olayiwola

Abstract


This study investigated the impact of foreign direct investment on employment creation in Nigeria for the period of 35years (1985-2019). The study used five regressors (foreign direct investment, trade openness, government expenditure, infrastructural development, and exchange rate) and one explained variable (employment rate). The data were culled from the World Bank Development Indicators and analysis was carried out using unit root test, ordinary least square and granger causality test. The findings revealed that there is negative and insignificant relationship between trade openness, government expenditure, infrastructures and employment rate. However, positive relationship exists between foreign direct investment, exchange rate and employment but statistically insignificant at 5% level of significance. Based on the f-statistic result, the study concluded that foreign direct investment played a crucial role in creating employment for the citizens of Nigeria. It was therefore recommended among others that government should improve the state of infrastructures and security in the country as the present economy is characterized by terrorisms, kidnapping and robbery and this may drive out the investors in the country and discourage the potential ones.


Keywords


Employment rate; Foreign direct investment; Exchange rate and government expenditure

Full Text:

PDF

References


Adeleke, K. M., Olowe, S. O. & Fasesin O. O. (2014). Impact of foreign direct investment on Nigeria economic growth. International Journal of Academic Research in Business and Social Sciences, 4(8), 234-242.

Adofu, I. (2010). Accelerating economic growth in Nigeria: The role of foreign direct investment. Current Research Journal of Economic Theory, 2(1), 11- 15

Afolayan, O., Okodua, H., Matthew, O., & Osabohien, R. (2019). Reducing unemployment malaise in Nigeria: the role of electricity consumption and human capital development. International Journal of Energy Economics and Policy, 9(4), 63-73. Retrieved from https://doi.org/10.32479/ ijeep.7590

Ajayi, A., Rafiu, O. A., & Samuel, O. A. (2019). Impact of foreign direct investment on employment and unemployment rate in Nigeria: Application of Vector Autoregression Model (VAR) models. Asian Journal of Advanced Research and Reports, 6(1), 1-15

Aremu, J. A. (2005). Foreign direct investment and performance. Paper delivered at a workshop on Foreign Investment Policy and Practice organized by the Nigerian Institute of Advanced Legal Studies, Lagos on 24 March.

Asiedu, E. (2006). FDI in Africa: the role of natural resources, market size, government policy, institutions and political instability. The World Economy, 29(1), 63-77. Retrieved from http://hdl.handle.net/10419/63499

Babasanya, A. O. B. (2018). Foreign direct investment and employment generation in Nigeria. Journal of Economics and Sustainable Development, 9(4), 42-47

Badeji , B. O., & Abayomi, O. M. (2011) The impact of foreign direct investment on economic growth in Nigeria. International Research Journal of Finance and Economics, 73(1). http://www.eurojournals.com/finance.htm

Dunning, J. H. & Rugman, A. M. (1985). The Influence of Hymer’s dissertation on the theory of foreign direct investment. American Economic Review, 75(2), 228-32.

Dunning, J. H. (1993). Multinational enterprise and the global economy. Wokingham: Addison Wesley

Johnny, N., Timipere, E. T., Krokeme, O. & Markjackson, D. (2018). Impact of foreign direct investment on unemployment rate in Nigeria. International Journal of Academic Research in Business and Social Sciences, 8(2), 58-69

Mencinger, J. (2003). Does foreign direct investment always enhance economic growth? Kyklos, 56(4), 491-508.

Okodua, H (2009). Foreign direct investment and economic growth: Co-integration and causality analysis of Nigeria. The African Finance Journal, 11(1), 29-45.

Okonjo-Iweala, N (2012). Kidnappers Quized My Mum on Subsidy Payments. The Punch Tuesday, December 18, P12.

Okoro, H. M. & Atan, A. J (2014). Impact of foreign direct investment on employment generation in Nigeria: A statistical investigation. IOSR Journal of Business and Management, 16(3), 44-56.

Osabohien, R., Awolola, O. D., Matthew, O., Itua, O. Q., & Elomien, E. (2020). Foreign direct investment inflows and employment in Nigeria. Investment Management and Financial Innovations, 17(1), 77-84.

Otepola, A. (2002). Foreign direct investment as a factor of economic growth in Nigeria. Being a thesis submitted in partial fulfillment of the requirements for the degree of Master of Arts in Economic Policy and Management at the African Institute for Economic Development and Planning.

Robu, R. G. P. (2010). The impact of foreign direct investments on labour productivity: A review of the evidence and implications. The Romanian Economic Journal, 36(1),

Sean - Leigh, S. (2007). Do conventional FDI theories explain why multinational enterprise conduct foreign direct investment in Thaliand?. A dissertation M.Sc international Business. Retrieved from edisetations. Retrieved from Nothingham.acuk /946/1/07/msc/ix.s3.pdf on October 20, 2013.

Shenkar, O. (2007). Foreign direct investment: theory and application. Retrieved fromwww.sagepub.com.upmdata/18594 chapters 3pdf on November 13, 2013.

Todaro, M. P., & Smith, S. C. (2003). Economic development (8th ed.). London: Pearson Education.

Wall, S. & Reess, B. (2004). International business (2nd ed.). Essexs, UK: prentice Hall.

Wheeler, D., & Mody, A. (1992). International investment location decisions: The case of US firms. Journal of international economics, 33(1-2), 57-76.

World Bank (2013). World Development Indicators. The World Bank, Washington, DC.

World Bank (2019). World Development Indicators. The World Bank, Washington, DC.




DOI: http://dx.doi.org/10.3968/12033

Refbacks

  • There are currently no refbacks.


Copyright (c) 2021 Canadian Social Science

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Reminder

  • How to do online submission to another Journal?
  • If you have already registered in Journal A, then how can you submit another article to Journal B? It takes two steps to make it happen:

Submission Guidelines for Canadian Social Science

We are currently accepting submissions via email only. The registration and online submission functions have been disabled.

Please send your manuscripts to css@cscanada.net，or css@cscanada.org for consideration. We look forward to receiving your work.

 Articles published in Canadian Social Science are licensed under Creative Commons Attribution 4.0 (CC-BY).

 

Canadian Social Science Editorial Office

Address: 1020 Bouvier Street, Suite 400, Quebec City, Quebec, G2K 0K9, Canada.
Telephone: 1-514-558 6138 
Website: Http://www.cscanada.net; Http://www.cscanada.org 
E-mail:caooc@hotmail.com; office@cscanada.net

Copyright © Canadian Academy of Oriental and Occidental Culture