How Investment Does Affect Unemployment in a Developing Economy

Thoroughly going through studies on unemployment tends to submit that investment, despite its strong empirical connection with unemployment, seemed to be relegated and ignored as a key variable behind solving unemployment threats. This study estimating a dynamic model with error correction was able to expound with empirical evidence using data from Nigeria between 1980 and 2017 that investment is capable of creating opportunities for employment of idle resources thus reducing the level of unemployment in a developing economy. Hence a justification for the assumption of the “Two-Gap model” that filling Saving-Investment gap will boost employment conditions. Recommendation therefore demands that attentions should be channeled towards investment (especially private investments) to ensure that available resources are attractive enough to attract both local and foreign investors at any given opportunity.