Journal Articles and Book Chapters

December 18, 2018

Developing a Human Development Index (HDI) for the Nigerian States: Conceptual Approach and Preliminary Evidence

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This study develops a comparable Human Development Index for subnational government in Nigeria. While built on the UNDP approach, we extend the generic framework to address challenges at the subnational level such as comparable indicator, data unavailability and estimation technique. The result shows wide disparity across states in their human development, with states within the southern region recording more impressive performance. We further examine the key economic and political drivers of the observed variations across state and found fiscal sustainability and geopolitical zoning as the key determinants.

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Portfolio Diversification Between Developed And Less Developed Economies

This study examines the hedging effectiveness of portfolio investment diversification between developed and developing economies; with focus on the Nigerian stock asset vis--vis the stock assets of the United States (US) and United Kingdom (UK). Its main contribution is in the analysis of optimal portfolio diversification using optimal portfolio weight (OPW) and optimal hedging ratio (OHR). Empirical findings show that the OPW and OHR are low, which indicates impressive potential gains from combining Nigerian stock assets in an investment portfolio with US and UK stock assets. In addition, exchange rate volatility is found to pose stern limitation on the potential benefits of this portfolio diversification arrangement. It is therefore recommended that the monetary authority in Nigeria should pursue policies towards reducing exchange rate volatility to the barest minimum. This will possibly attract more investors from developed economies who might be willing to combine Nigerian stock in their investment portfolio to minimize portfolio risk.