Investment in Telecommunications Infrastructure and Economic Growth in Nigeria: A Multivariate Approach
B. O. Adegbemi Onakoya *
Department of Economics, Tai Solarin University of Education, Ijagun, Ijebu Ode, Nigeria.
A. Sheriffdeen Tella
Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria.
M. Adenike Osoba
Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
This paper attempts to investigate the impact of investment in telecommunications infrastructure on economic growth in Nigeria. A multivariate model of simultaneous equations was deployed. The paper also deploys three-stage least squares method to capture the transmission channels through which telecommunications infrastructure promotes growth. The finding shows that telecommunications infrastructural investment has a significant impact on output of the economy directly through its industrial output and indirectly through the output of other sectors such as agriculture, manufacturing, oil and other services. The results also show a bi-directional causal relationship between telecommunications infrastructure and economic growth. The paper recommends for more effective telecommunications infrastructure that will further impact economic growth in Nigeria.
Keywords: Investment, telecommunications infrastructure, causality, economic growth, macroeconometric model.