Abstract:
This study examines the impact of globalization and financial market development on the economic growth of some selected West African countries. The study employed 11 countries which include Nigeria, Ghana, Senegal, Mali, Benin, Niger, Côte d'Ivoire, Gambia, Guinea Bissau, Burkina Faso and Sierra Leone. The data spanned from 1978 to 2017 (40 years). The Generalized Method of Moments (GMM) through the fixed and random effects estimation technique was applied in the data analysis. Pre-estimation and post estimation test were also carried out to ascertain the nature of the data and to examine the robustness of the regression result. The results shows that the lag value of real GDP, stock of physical capital, labour force and globalization has a positive impact on economic growth while financial market development and inflation shows negative impact on economic growth of the region. Also, financial market development has insignificant relationship with investment whereas per capital income, labour force and globalization have a positive relationship with investment while real exchange rate and inflation shows a negative relationship with investment. the result also shows that globalization have insignificant relationship with financial market development, and financial market development, interest rate, inflation rate, real exchange rate and real GDP shows a positive and significant relationship with per capita income of the region. Hence, the study concludes that globalization and financial market development, if well harnessed, have the possibilities of increasing the economic growth of West Africa in the long-run.
