Determinants of brain drain in Nigeria: Does financial inclusion matter?

https://doi.org/10.35912/jgas.v4i2.2417
Published: Oct 11, 2024

Abstract:

Purpose: Nigeria has witnessed a substantial emigration of educated and skilled workers to other countries in the quest for greener pastures. Developing nations, such as Nigeria, with a recognizable number of highly educated and skilled individuals with an attitude to work to earn a living, are potentially exposed to brain drain syndrome, which is inimical to economic prosperity struggles. Hence, this study investigated whether financial inclusion is a determinant of brain drain in Nigeria.

Method: Quantitative methods were used in this study, employing ARDL-ECM regression to analyze both short- and long-run relationships among the variables. Data were collected from the International Monetary Fund, Nigeria Bureau of Statistics, and the Central Bank of Nigeria (2003–2022).

Results: The study established that Gross Domestic Product per Capita, ATMs per 100,000 Adults, Deposits with Commercial Banks % to GDP and Political Stability have a negative relationship with Brain Drain in Nigeria, whereas unemployment, bank credit to the private sector, and government efficiency have a positive relationship with brain drain.

Limitations: The study was limited to Nigeria, and the findings may not be generalizable to other countries.

Contributions: This study contributes to the field of finance in terms of financial inclusion matters and to the Nigerian government by identifying the determinants of brain drain in Nigeria.

Novelty: This study added financial inclusion as a determinant of brain drain in Nigeria, which other existing studies have not covered.

Keywords:
1. Financial Inclusion
2. ATMs
3. Government Effectiveness
4. Brain Drain
5. Human Capital Flight
Authors:
1 . Ahmed Alhaji Aliyu
University of Ilorin, Nigeria
2 . Mutalib Tunde Lawal
University Sokoto, Nigeria
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Aliyu, A. A., & Lawal, M. T. (2024). Determinants of brain drain in Nigeria: Does financial inclusion matter?. Journal of Governance and Accountability Studies, 4(2), 95–108. https://doi.org/10.35912/jgas.v4i2.2417
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Issue & Section
Vol. 4 No. 2 (2024): July
Articles
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This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

References

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    Adhikari, S., Clemens, M. A., Dempster, H., & Ekeator, N. L. (2021). Expanding Legal Migration Pathways from Nigeria to Europe : From Brain Drain to Brain Gain. Retrieved from https://documents.worldbank.org/pt/publication/documents-reports/documentdetail/873041626087072895/expanding-legal-migration-pathways-from-nigeria-to-europe-from-brain-drain-to-brain-gain

    Ajide, F. M. (2020). Financial inclusion in Africa: does it promote entrepreneurship? Journal of Financial Economic Policy, 12(4), 687-706.

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    Altaf, M., Kalsoom, A., & Ali, H. (2015). Two-fold aspect of brain drain in Pakistan: An empirical investigation. Journal of glob & Sciences, 3(3), 2307-6275.

    Arouri, M., Rashid, Y., Shahbaz, M., & Teulon, F. (2014). Short and long run determinants of brain drain: Evidence from Pakistan. Retrieved from

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    Chakilia, S., & Ahado, H. E. (2024). The role of financial and marketing services on rural shea-producing women. International Journal of Financial, Accounting, and Management, 6(1), 93-104.

    Cicchiello, A. F., Kazemikhasragh, A., Monferrá, S., & Girón, A. (2021). Financial inclusion and development in the least developed countries in Asia and Africa. Journal of Innovation and Entrepreneurship, 10, 1-13.

    Emeghara, E. (2013). Brain drain as a clog in the wheel of Nigeria’s development: The university education system in focus. International Journal of Development and Management Review, 8(1), 110-121.

    Erlando, A., Riyanto, F. D., & Masakazu, S. (2020). Financial inclusion, economic growth, and poverty alleviation: evidence from eastern Indonesia. Heliyon, 6(10).

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    Siddik, M. N. A. (2017). Does financial inclusion promote women empowerment? Evidence from Bangladesh. Applied Economics and Finance, 4(4), 169-177.

    Tamirat, N. (2023). Determinants of youth unemployment in Southern Ethiopia: Evidence from Duna District, Ethiopia. International Journal of Financial, Accounting, and Management, 4(4), 509-520.

    Wani, A. S. (2022). The genesis of Islamic finance system: Exploring the mainsprings and emerging markets. International Journal of Financial, Accounting, and Management, 4(1), 31-47.

    Wezel, T., & Ree, M. J. J. (2023). Nigeria--fostering financial inclusion through digital financial services: International Monetary Fund.

  1. AbdulKareem, I. A., Olaide, K. M., & Isiaka, O. S. (2021). Curbing unemployment and brain drain among Nigerian youths through Islamic financing instruments. Journal of Islamic Economic and Business Research, 1(1), 59-71.
  2. Adefusika, J. A. (2010). Understanding the brain-drain in the African diaspora: Focusing on Nigeria.
  3. Adhikari, S., Clemens, M. A., Dempster, H., & Ekeator, N. L. (2021). Expanding Legal Migration Pathways from Nigeria to Europe : From Brain Drain to Brain Gain. Retrieved from https://documents.worldbank.org/pt/publication/documents-reports/documentdetail/873041626087072895/expanding-legal-migration-pathways-from-nigeria-to-europe-from-brain-drain-to-brain-gain
  4. Ajide, F. M. (2020). Financial inclusion in Africa: does it promote entrepreneurship? Journal of Financial Economic Policy, 12(4), 687-706.
  5. Akusoba, C. (2014). Understanding brain drain in Nigerian universities.
  6. Altaf, M., Kalsoom, A., & Ali, H. (2015). Two-fold aspect of brain drain in Pakistan: An empirical investigation. Journal of glob & Sciences, 3(3), 2307-6275.
  7. Arouri, M., Rashid, Y., Shahbaz, M., & Teulon, F. (2014). Short and long run determinants of brain drain: Evidence from Pakistan. Retrieved from
  8. Balogun, K. (2016). Unemployment in Africa Paper Presented at African Transformation Forum organized by African Centre for Economic Transformation (ACET), April, 2016. Kigali, Rwanda.
  9. Chakilia, S., & Ahado, H. E. (2024). The role of financial and marketing services on rural shea-producing women. International Journal of Financial, Accounting, and Management, 6(1), 93-104.
  10. Cicchiello, A. F., Kazemikhasragh, A., Monferrá, S., & Girón, A. (2021). Financial inclusion and development in the least developed countries in Asia and Africa. Journal of Innovation and Entrepreneurship, 10, 1-13.
  11. Emeghara, E. (2013). Brain drain as a clog in the wheel of Nigeria’s development: The university education system in focus. International Journal of Development and Management Review, 8(1), 110-121.
  12. Erlando, A., Riyanto, F. D., & Masakazu, S. (2020). Financial inclusion, economic growth, and poverty alleviation: evidence from eastern Indonesia. Heliyon, 6(10).
  13. Farooq, S., & Ahmad, E. (2017). Brain Drain from Pakistan: An Empirical Analysis. Forman Journal of Economic Studies, 13.
  14. Hendriks, S. (2019). The role of financial inclusion in driving women’s economic empowerment. Development in Practice, 29(8), 1029-1038.
  15. Karikari, N. K., Mensah, S., & Harvey, S. K. (2016). Do remittances promote financial development in Africa? SpringerPlus, 5, 1-21.
  16. Kim, D.-W., Yu, J.-S., & Hassan, M. K. (2018). Financial inclusion and economic growth in OIC countries. Research in International Business and Finance, 43, 1-14.
  17. Kousar, S., Ahmed, F., & Bukhari, S. A. A. (2020). Macroeconomic determinants of brain drain in the era of globalization: evidence from Pakistan. Liberal Arts and Social Sciences International Journal (LASSIJ), 4(2), 24-41.
  18. Lee, E. S. (1966). A Theory of Migration. Demography, 3(1), 47-57.
  19. Mader, P. (2018). Contesting financial inclusion. Development and change, 49(2), 461-483.
  20. Mitra, A., Bang, J. T., & Wunnava, P. V. (2011). Financial liberalization and the brain drain: a panel data analysis.
  21. Nnoruga, J. N., & Osigwe, C. N. (2023). Brain drain in Nigeria: A challenge to human capital development. NIGERIAN JOURNAL OF AFRICAN STUDIES (NJAS), 5(2).
  22. Onireti, A. (2024). Sustaining Nigeria’s Intellectual Talent Pool: A Key Driver for Economic Growth, Workforce Resilience, and Innovation. Retrieved from https://proshare.co/articles/sustaining-nigerias-intellectual-talent-pool-a-key-driver-for-economic-growth-workforce-resilience-and-innovation?menu=Business&classification=Read&category=People
  23. Oyeleke, M. (2023). 'How Many Talents Have to Leave Before We Care?': Addressing the Issue of Brain Drain and Emigration in Nigeria. Addressing the Issue of Brain Drain and Emigration in Nigeria (July, 2023).
  24. Popogbe, O., & Adeosun, O. T. (2020). Empirical analysis of the push factors of human capital flight in Nigeria. Journal of Humanities and Applied Social Sciences, 4(1), 3-20.
  25. Saefullah, A., Radjawane, L. E., Sutrisno, E., Santoso, A., & Kuraesin, A. D. (2023). Access through road in Pahing Hamlet, Sukadana Village, Kuningan Regency as a means of improving the community's economy. International Journal of Financial, Accounting, and Management, 5(3.1), 407-420.
  26. Shahabadi, A., Salehi, M., & Hosseinidoust, S. E. (2020). the impact of competitiveness on brain drain, GMM panel approach. Journal of the Knowledge Economy, 11, 558-573.
  27. Siddik, M. N. A. (2017). Does financial inclusion promote women empowerment? Evidence from Bangladesh. Applied Economics and Finance, 4(4), 169-177.
  28. Tamirat, N. (2023). Determinants of youth unemployment in Southern Ethiopia: Evidence from Duna District, Ethiopia. International Journal of Financial, Accounting, and Management, 4(4), 509-520.
  29. Wani, A. S. (2022). The genesis of Islamic finance system: Exploring the mainsprings and emerging markets. International Journal of Financial, Accounting, and Management, 4(1), 31-47.
  30. Wezel, T., & Ree, M. J. J. (2023). Nigeria--fostering financial inclusion through digital financial services: International Monetary Fund.