FINANCIAL DEVELOPMENT, TRADE OPENNESS AND ECONOMIC GROWTH IN NIGERIA

: The study investigates the effect(s) of financial development and trade openness on economic growth in Nigeria over the period of 1980 – 2017. It made use of empirical data to explore the channels through which financial development would influence economic growth in Nigeria specifically in the context of international trade openness and foreign direct investment. The economic model is designed such that it investigates the long run relationship among the three variables, the Autoregressive Distributed Lag Model (ARDL) Bounds co-integration approach was adopted for the analysis. Result findings show that there are strong evidences of the long-run relationship between financial development, Trade Openness and economic growth in Nigeria. The broad money supply has a positive but insignificant effect on the nation’s Gross Domestic Product in the short run while Credit to Private Sector ratio has a negative but significant effect on Gross Domestic Product in the short run in Nigeria. The short run and long run model shows that both the trade Openness policies and financial development policies are significant variables in the development of the Nigerian economy; this calls for effective policy measures to address the challenge of economic growth. A study was carried out in Argentina by [6]Tsaurai, 2017 the result of the research showed that there is a positive and significant causality in the longrun between financial development and trade openness in Argentina. Also, [7]Altaee and Al-Jafari, (2015) conducted a similar study in which their findings suggest that trade openness and financial developments are important elements in determining economic growth in Bahrain. [8]Chimobi, 2010 in their study, examined the relationship between financial development, trade openness and economic growth in Nigeria. The study further confirmed a long run relationship between these variables in the country of study. Furthermore, [9]Ewetan and Okodua 2013, examined the long run relationship between financial development and economic growth the result showed evidence of co-integration among economic growth, financial development, and other variables, indicating the existence of long run relationship between the variables. Using panel data analysis with data from 1965 to 2008 among different African countries, [10]Menyah et al, 2014 studied the relationship among the three variables in question in different African countries. Their empirical findings revealed the existence of negligible or no relationship between trade openness and financial development on economic growth. [11]Ho and Iyke, 2018 did a study on 43 countries in sub-Saharan Africa over the period of 1996 to 2014. They found out that trade openness enhances financial development in the long term. However, in the short term, the effect of trade openness seems to be negative. On the other hand, there are some empirical studies that suggest that there is no or insignificant of financial development and trade openness towards economic growth. For instance, [12]Gries et al, 2009 in their study found out that trade openness would reduce economic growth in a country in the short run while in the long run it would then have a positive effect on economic growth. Furthermore, [13]O‟Donnell (2001) and [14]Klein and Olivei, (1999) had similar results; they found out that financial development and trade openness, had impact on middle income