Macroeconomic determinants of capital inflows volatilities in Nigeria

Abstract

This paper investigates the macroeconomic determinants of capital inflows olatilities in Nigeria between 1986 and 2018. Annual data were collected from  World Development Indicators (WDI) and were estimated using the Autoregressive Distributive Lagged (ARDL) econometric method. Findings from our  estimation revealed that the growth of the world economy is the core determinant of volatilities of capital inflow both in the short run and the long run.  The only exception is the volatility of remittances which is mainly determined by the exchange rate, both in the short run and the long run. However, the  volatility of the official Development Assistance (ODA) is more susceptible to domestic factors both in the short run and the long run. The study therefore  concludes that volatilities of capital inflows into Nigeria depend on the agency mobilizing the flow. While the private inflows are largely determined by the  push factors, the public inflow in form of aid is determined by pull factors.