FINANCIAL INNOVATION AND OUTPUT GROWTH OF SMALL AND MEDIUM-SCALE INDUSTRIES IN NIGERIA
- Peter Ubi
- Peter Mba
- ( paper pages. 1 - 27 )
Abstract
This study assesses the role of financial innovation in output growthof small and medium-scale industries (SMEs) in Nigeria usingquarterly data from 2009 to 2016. It employs the regressivedistributed bounds testing approach (ARDL) and the Grangercausality test to ascertain the long-run impact and the causalrelationship between financial innovation variables and SMEs’ outputgrowth. Evidence from the analyses confirms the theoreticalproposition that financial innovation contributes positively to theoutput growth of SMEs in Nigeria as the financial innovationvariables of POS, MBK, ATM and INTB have positive and statisticallysignificant impact on the output growth of SMEs. The Grangercausality test indicates that a unidirectional causal relationship runsfrom financial innovation variables to SMEs output in Nigeria. Basedon this empirical evidence, the paper recommends that the positiveimpact of the financial innovation variables on SMEs output demandsthat deposit money banks not only improve but also expand thecurrent level of financial service delivery in Nigeria by establishingmore financial channels in both rural and urban areas.
Citation
Peter Ubi, Peter Mba.
2019.
"FINANCIAL INNOVATION AND OUTPUT GROWTH OF SMALL AND MEDIUM-SCALE INDUSTRIES IN NIGERIA"
The Nigerian Journal of Economic and Social Studies,
61 (2): 1 - 27.
JEL Classification
G21, G22, O31
