வணிகம் மற்றும் பொருளாதார இதழ்

Testing for Unit Roots and Structural Breaks: Evidence from Banking Sector Reforms in Nigeria

Abstract

Okoi Innocent Obeten1*,Effiong Charles1and Offem lekam

This paper examines the structural breaks dates for capital base, interest rates, exchange rates, corporate governance and economic growth in Nigeria using annual banking reform variables data spanning from 1970 through 2015. The theory used in the research was Balance growth theory. The study applied conventional unit root test of Augmented Dicker Fuller (ADF). Time series properties of the data are analyzed using Chow test approach to examine the more likely time of structural breaks in banking reform variables of the Nigerian economy. The study has established that structural breaks exist in all banking reform variables employed in the study. We therefore, conclude that structural change is pervasive in banking sector reform and it can be quite dangerous to ignore. It was recommended that given that structural breaks are associated with regime changes, there is need for the potential use of regime switching models in Nigeria.