Private Investments in Nigeria and the Manufacturing Sector: A VECM approach

Abstract

This study examines the determinants of private Investment in Nigeria`s manufacturing sector for 1970-2010. The study adopted the Vector Error Correction Model approach, estimated using the Ordinary Least Square estimator. The results showed that manufacturing output significantly responded to the contemporaneous perturbation in the values of nominal exchange rate, policy lending rate and the corporate income tax. These series also showed a high tendency of recovery from the deviation from their equilibrium values in subsequent periods.