Market Mediation in Diverse Economic Structures: A Comparative Empirical Study of Nigeria and Some Developed Economies

Abstract

This study examines how market mechanisms—stock market development, remittances, and trade openness—drive economic growth through mediating factors in Nigeria versus some developed economies over 2014–2024. Applying panel Structural Equation Modelling (SEM), moderated‐mediation analysis, and fixed‐effects regression, we decompose total effects into direct and indirect pathways via country risk, institutional quality, and macroeconomic stability. Descriptive, correlation, regression, and SEM results reveal that institutional quality mediates 38 % of the stock market–growth link in Nigeria compared to 56 % in developed economies, while country risk dampens market effects more in Nigeria (32 % vs. 14 %). Macroeconomic stability amplifies openness effects more strongly in mature markets (60 % vs. 50 %). Robustness checks (heteroskedasticity, autocorrelation, VIF) and alternative measures confirm these findings. We discuss policy strategies tailored to Nigeria’s structural realities and lessons from mature markets.