ABSTRACT

The study examined the impact of interest rate liberalization on investment in Nigeria from 1975-2016 using error correction model (ECM). The empirical findings of the study provide evidence that interest rate liberalization has no significant effect on investment in Nigeria. The result further showed that interest rate and public expenditure are insignificant factors explaining variations of investment. However, market capitalization and trade openness exerted a positive significant impact on investment. The study therefore recommended that government through the central bank of Nigeria should use her monetary policies to influence interest rate in such a way as to stimulate investment in Nigeria.