CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
A country must invest to build up productive capacity for growth to occur. It is this capacity that determines the level of output of goods and services in the economy. If investment which represents the net increase in an economy’s’ capital stock, leads to growth then there is relationship between capital accumulation and economic growth when sustain growth has occurred. It is expected that over time with appropriate policies that allow for more equitable distribution of income among a progressive larger percentage of the population, economic development would follow.
Hence, the fact that capital is needed for economic growth is not disputable.
In the early 1980’s the analyst frame work on which standard structural adjustment programmes of the world bank and IMF was drawn, placed tremendous resources in self sustained growth process. So every country needs capital to grow. The possession of relatively small stocks of various kinds of capital is a characteristic of under developed were as the condition of being developed means having accumulated established, efficient social and economic mechanism for maintaining and increasing large stocks of capital per head in various forms.
Therefore for under developed economy, a country’s capital stock will only contribute to the economic growth. If its investments are productive in this respect, the domestic economy must provide the right policy environment incentives and stability that can sustain and encourage the required flow of savings from the surplus spending units and then into long-term investment that will enhance productive capacity. The capital market contributes to the mobilization of savings by providing a variety of market instrument for the holding of financial assets in the economy. While improving opportunities for business to obtain equities and long term loans, which encourage long term productive investments.
Savings and investments are carried out by two distinct groups of people, thus the need for some form of medication, various types of financial institution the stock exchange, issuing houses, stock brokers, share registrars share distribution agents (commercial banks) institutions investors (merchant banks) Nigeria enterprises promotion board, (NEPB) Nigeria security and exchange
Terms of Use: This is an academic paper. Students should NOT copy our materials word to word, as we DO NOT encourage Plagiarism. Only use as a guide in developing your original research work. Thanks.
Disclaimer: All undertaking works, records, and reports posted on this website, eprojectguide.com are the property/copyright of their individual proprietors. They are for research reference/direction purposes and the works are publicly supported. Do not present another person’s work as your own to maintain a strategic distance from counterfeiting its results. Use it as a guide and not duplicate the work in exactly the same words (verbatim). eprojectguide.com is a vault of exploration works simply like academia.edu, researchgate.net, scribd.com, docsity.com, course hero, and numerous different stages where clients transfer works. The paid membership on eprojectguide.com is a method by which the site is kept up to help Open Education. In the event that you see your work posted here, and you need it to be eliminated/credited, it would be ideal if you call us on +2348064699975 or send us a mail along with the web address linked to the work, to eprojectguide@gmail.com. We will answer to and honor each solicitation. Kindly note notification it might take up to 24 – 48 hours to handle your solicitation.