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This paper empirically investigated the impact of foreign capital inflows and financial
development on economic growth in ECOWAS countries. The study made use of
quarterly data series from 2000 to 2017 for the analysis. Adopting the panel fixed-effect
regression, the empirical results showed that Foreign Direct Investment (FDI), net
domestic credit (CRE), Gross Capital Formation (GCF), and Foreign Aid (AID) increase
economic growth in ECOWAS region while labour force (LF) and Trade Openness
(OPEN) revealed otherwise. The study therefore recommended that concerned policy
makers in the ECOWAS region should pursue financial deepening and strengthen
policies that will enhance the operations of the financial system. Also member countries
should create a conducive socio-political and economic environment for foreign
investors to invest in the economies. This can be done by reducing the corruption
prevalent in the system, ethnic unrest, introduction of tax holidays, stability of policies
introduced by the government, among others. In this era of Covid-19 many have lost
their jobs and the economy of ECOWAS needs to be revitalized by following these
economic prescriptions, among others.