The Impact of Financial Globalization on Financial Development in Nigeria (1981 – 2021)


  • Dorothy Ivie Okoduwa VERITAS UNIVERSITY, ABUJA


Financial globalization, banking sector development, stock market development, ARDL, Nigeria


Financial globalization has been predicted to facilitates capital inflows and enhance the internationalization of financial services. Despite various financial liberalization policies, the performance of the Nigerian financial sector has been unimpressive. This study analyzed the impact of financial globalization on financial development in Nigeria. The study covered the period 1981 to 2021 and employed the Auto-regressive Distributed lag (ARDL) technique. The result from the study showed that financial globalization significantly enhanced financial development (proxied by banking sector development and enhanced stock market development). Thus, the study concluded that financial globalization is a significant driver of both banking sector development and stock market development. The study recommended the need for more active financial globalization reforms that can enhance the growth of the banking sector and the stock market.


Ahmed, A.O. (2021). Trivariate modelling of the nexus between financial development, globalization and economic growth: Insight from African Countries. International Journal of Finance Research, 2(3), pp. 129-142.

Asongu, S.A. & De Moor, L. (2015). Financial globalization dynamic thresholds for financial development: evidence from Africa. AGDI Working Paper, No. WP/15/035, African Governance and Development Institute (AGDI), Yaoundé.

Balcilar, M.; Gungor, H. & Olasehinde-Williams, G. (2019). On the impact of globalization on financial development: A multi-country panel study. European Journal of Sustainable Development, 8(1), pp. 350-364.

Bhanumurthy, N.R. & Kumawat, L. (2020). Financial globalization and economic growth in South Asia. South Asia Economic Journal, 21(1), pp. 31-57.

Dash, S.; Rath, S. & Pati, U. (2018). Financial globalization and its impact on human development: A comparative analysis of India, Singapore and Japan. Revista Espacios, 39(14), pp. 1-17.

Edgar, D. & Tovar, G. (2012). Financial Globalization and financial development in transition countries. ECONOMĺA, 36, pp. 155-178.

Fuinhas, J.A.; Marques, A.C. & Lopes, C. (2019). The impact of financial development and globalization on economic growth: Evidence from a macro panel of ten countries. Asian Economic and Financial Review, 9(3), pp. 366-388.

Gorg, H. & Greenaway, D. (2004). Much ado about nothing? Do domestic firms really benefit from foreign direct investment? The World Bank Research Observer, no. 19(2).

Ikhide, S.I. (1996). Financial sector reforms and monetary policy in Nigeria. Project undertaken as a Visiting Fellow to the Institute of Development Studies between March and May 1996.

Kozul-Wright, R. & Rayment, P. (2007). The resistible rise of market fundamentalism: Rethinking development policy in an unbalanced world. Zed Books. London and New York.

Kutor, S.K. (2014). Processes of globalization and its effects on the life of people in the global south by drawing examples from Ghana. Research on Humanities and Social Sciences, 4(6), pp. 95-99.

Lu, J.; Imran, M.; Haseeb, A.; Saud, S.; Wu, M.; Siddiqui, F. & Khan, M.J. (2021). Nexus between financial development, FDI, globalization, energy consumption and environment: Evidence from BRI countries. Frontiers in Energy Research, 9, pp. 1-12.

Malik, C. (2020). The linkage between globalization and financial inclusion: Do inequality and institution matter? Economic Journal of Emerging Markets, 12(2), pp. 220-133.

Meyer, K.E. (2004). Perspectives on multinational enterprises in emerging economies. Journal of International Business Studies, 35(4).

Muye, I.M. & Muye, I.Y. (2017). Testing for causality among globalization, institution and financial development: Further evidence from three economic blocs. Borsa Istanbul Review, 17(2), pp. 117-132.

Nissanke, M. (2009). Linking economic growth to poverty reduction under globalization. A case of harnessing globalization for the poor in sub-Saharan Africa. Paper presented for the AERC project on “Understanding Links between Growth and Poverty Reduction in Africa”.

Omar, A. & Inaba, K. (2020). Does financial inclusion reduce poverty and income inequality in developing countries? A panel data analysis. Journal of Economic Structures, 9(37), pp. 1-25.

Schmukler, S.L. (2003). Financial globalization: Gain and pain for developing countries. Development Research Group, World Bank.

World Bank (2018). Globalization, growth and Poverty: Building an inclusive world economy. A World Bank Policy Research Report. New York: Oxford University Press.




How to Cite

Okoduwa, D. I. (2024). The Impact of Financial Globalization on Financial Development in Nigeria (1981 – 2021). The Journal of Accounting and Management, 14(1), 49–57. Retrieved from