THE FINANCIAL SYSTEM AND ECONOMIC GROWTH IN NIGERIA

📄 Project Abstract

A financial system is a set of rules, regulations and the aggregation of financial arrangement, institutions and agents that interact with each other and the rest of the world to foster economic growth and development of a nation (Nzotta and Okereke, 2009). According to Nwude (2004), financial systems consist of financial markets, financial intermediaries, financial instruments, rules, conventions and norms that facilitate and regulate the flow of funds through the macro-economy. A good financial system, according to Rousseau and Sylla (2001), is one that has these five key components: (i) Sound public finances and public debt management, (ii) Stable monetary arrangement, (iii) A variety of banks some with domestic and others with international orientations and perhaps some with both orientation, (iv) Well functioning securities market, and (v) A central bank to stabilize domestic finances and manage international financial relations. Economists argue about the relationship between the...