Savings, investment, productivity and economic growth in Nigeria (1975-2007)

Abstract

This study examined the relationship between savings and investment, and between investment and economic growth. A corollary of the work is the determination of which of the inputs of production contributes more to economic growth in Nigeria. The study makes use of time series
data spanning thirty-three years using Ordinary Least Square methods. The result shows a positive relationship between savings and investment. It also confirms the existence of a positive relationship between Investment and economic growth. Of the determinants of savings considered in the study, inflation rate contributes negatively to saving, while interest rate
positively affect saving. All these confirm economic theory. The striking feature of the study however is the confirmation of the impact of labour on economic growth, which according to the study far outweighs the contribution of capital.