STRUCTURAL ANALYSIS OF THE NIGERIAN FINANCIAL SYSTEM IN THE POST LIBERALIZATION ERA AND ITS IMPACT ON ECONOMIC GROWTH

STRUCTURAL ANALYSIS OF THE NIGERIAN FINANCIAL SYSTEM IN THE POST LIBERALIZATION ERA AND ITS IMPACT ON ECONOMIC GROWTH
 
The seminal works of McKinnon (1973) and Shaw (1973) supported Schumpeter‟s view of promoting the development of financial sector to achieve economic growth. They criticized the financial repressionists‟ view adopted by many governments in developing countries in the early 1970s. The traditional justification for financial repression is that it is presumed to increase the rate of economic growth. This argument is based on the assumption that money and real assets are perfectly substitutable, that increasing returns in real asset markets relative to money market instruments will induce a change in investor behaviour, so shifting investment out of money market into capital investment.