Macroeconomic determinants of savings in a developing economy: a new empirical evidence from Nigeria

Subject and purpose of work: The issue of savings and what motivates it has continued to generate argument. This study, therefore, investigated the determinants of savings in Nigeria over the period 1980 to 2017.

Materials and methods: The study employed the Classical Linear Regression Model in its analysis.

Results: The results showed that the determinants of savings include per capita income, gross fixed capital formation, financial deepening and exchange rate. Interest rate and inflation rate showed negative impact on savings.

Conclusions: The study recommended that the variables that showed positive impact on savings rate should be properly directed with the relevant policy tools to ensure higher saving rates. Again, the government should direct spending towards economic activities that encourage the creation of more jobs and investments. This will enable individuals, firms and governments to have more money to save. Finally, the Monetary Authorities should pursue financial deepening policies and implement strategies that will enhance the increase of savings in Nigeria.