Department of Accounting and Finance

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Browsing Department of Accounting and Finance by Author "ABDULLAHI Ibrahim Bello"

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    NEXUS BETWEEN FINANCIAL SECTOR AND INCOME DISTRIBUTION IN NIGERIA.
    (Department of Accounting, University of Ilorin, Ilorin, Nigeria, 2019) ADEMOKOYA ALADE AYODEJI; ABDULLAHI Ibrahim Bello
    The nexus between the-financial sector and income distribution has been identified in the literature, being the second pillar and an indispensable requirement to achieving sustainable development. Unfortunately, it is uncertain if Nigeria will meet up with the United Nations sustainable development goal of ending poverty by the year 2030. This is due o1 the extreme income gap among her citizens, 50 percent of its populace currently living below the poverty line of US $1.90 per day. This study examines the nexus between financial sector and income distribution in Nigeria. Time series data from 1986-2015 were obtained from the World Development Indicators, Central Bank Statistical Bulletin, the Global Consumption and Income Pattern Database Autoregressive Distributed Lag (ARDL) bounds test was estimated and findings reveal that: The level of banking sector intermediation has a negative and significant relationship (θ=-0.67:P <0.01) with income inequality; degree of monetization in the economy has a negative and significant relationship (θ=-0.238:P <0.1)with income inequality; Stock market capitalization exerts a negative and significant relationship (θ=-0.110:P <01) with income inequality; Stock market liquidity negatively and significantly (θ=-0.036:p <0.01 ) influences income inequality and the level of insurance business penetration in the economy has no significant relationship (θ=-0.070:P > 0.1) with income inequality in Nigeria. This study concluded that the banking and the stock marker sub-sectors of the financial system significantly influence income distribution in Nigeria. Study, therefore, recommends that the government through its regulatory authorities should put in appropriate policies that can encourage financial intermediation at low cost and strengthen the regulatory framework guiding operations of the stock market sub-sector of the financial system in order to make it resilient, effective, and efficient toward income distribution in Nigeria.