Authors : Onuoha Ijeoma Perpetua, Uwakwe Theresa Nnenna, Oko Roseline Ali and Obi Chinazor Franca
Abstract: This study examines the variations in interest rate structure on corporate financial investment decisions in Nigeria. The study spans from the periods 2000-2019. The objective of this research among others is to find out the effect of interest rate variations on corporate financial investments in Nigeria. The study employed a quasi experimental correlation design using an Ordinary Least Square (OLS) method of regression analysis and various tests of significance. The first observation revealed that positive relationship exists between the interest rates and the level of corporate investment decisions. The result of the second regression revealed an inverse relationship which indicates that investment in corporate assets increases with decrease in interest rate. It is pertinent, therefore, to assert from the investigations made, so far that the level of variation in interest rate played a negative but highly significant role in investment decision in the economy. Demand for credit also had negative and significant influence on interest rate variations in both the short run and long run. Although, the study deduced that investment has an indirect relationship with interest rate variation, other variables such as debt income, real income, government spending, aggregate savings and money stock affects gross domestic investment. Improvement in these key macro-economic variables is a necessary condition towards facilitating investment in Nigeria. The researcher recommends inter alia that an essential prerequisite condition needed to promote corporate financial investments is for the government to formulate and implement policies that enhances investments.
Onuoha Ijeoma Perpetua, Uwakwe Theresa Nnenna, Oko Roseline Ali and Obi Chinazor Franca, 2019. Analysis of the Variability of Interest Rate Structure on Corporate Financial Investment Decisions: The Nigerian Perspective. International Business Management, 13: 381-391.