Department of Economics
Permanent URI for this community
Department of Economics
Browse
Browsing Department of Economics by Subject "Economic growth"
Now showing 1 - 3 of 3
Results Per Page
Sort Options
- ItemOpen AccessDynamics of Inflation and Economic Growth in Nigeria: 1970 - 2005(2015-08-21) Adegboye, Abiodun AdewaleThe study examined the nexus between inflation and economic growth in the Nigerian economy. It specifically analyzed the dynamic and causal interactions between the two variables; determined the critical level of inflation for target growth rate and examined the extent to which money supply had been driving inflation-growth process in Nigeria. This was with a view to providing empirical evidence for the rationality behind inflation targeting framework in the Nigerian economy. The study employed quarterly time series data, from 1970 to 2005, collected from various issues of Central Bank of Nigeria's Statistical Bulletin and Annual Report and Statement of Account as well as 2005 edition of International Financial Statistics published by the International Monetary Fund. A VECM model was adopted in the analyses of the interactions between inflation and growth. Also a modified version of threshold methodology was estimated, using OLS, in determining the threshold level of inflation for Nigeria. Descriptive statistics such as table and charts were employed to capture the influence of money supply on inflation-growth process. The results showed that there was a significant inverse relationship between inflation and growth in the short run (t= -2.03, p<0.05) and positive but significant relationship in the long run (t=4.05, p<0.05) only at a low level of inflation. Also, the money supply (t=-2.13, p<0.05) and economic growth (t=4.87, p<0.05) adjusted to their equilibrium positions within two quarters. Results further showed that causality occurred from economic growth to inflation (F=14.48, p=0.00) at five per cent while substantial feedback effects occurred between inflation and growth (F=7.54, p=0.07) ten per cent significant levels. The impulse responses and variance decomposition analyses (with forecast error ranges from 0.34 - 0.87) established that output growth was an important factor in general price level determination in Nigeria. The critical level of inflation for Nigeria was estimated to be at 4 per cent. This indicated that to incl. ease economic growth in Nigeria by 1.87 per cent, the inflation rate must be below 4 per cent. Furthermore, the results showed that money supply had been driving both inflation and growth separately, however money supply was significant in implementing monetary policy for both long run (t=5.36, p<0.05) and short run (t=4.87, p<0.05) in Nigeria. The study concluded that the phenomenon of inflation was a long run issue in Nigeria and an inflation targeting policy was long overdue for its formal implementation in monetary management in the Nigerian economy.
- ItemOpen AccessEffects of Health Investment on Economic Growth in Nigeria, 1977-2004(2015-04-10) Akintunde, Temitope SadeThe study appraised the various health policies of the government in Nigeria and assessed the trend and pattern of government spending on health during the period 1977-2004. This was with a view to determining the short run and long run effects of investment in health on economic growth. The study used secondary data collected from Statistical Bulletin of the Central Bank of Nigeria (CBN), and the International Financial Statistics (IFS) published by the International Monetary Fund (IMF). Time series properties of the variables were analyzed using the Augmented Dickey-Fuller test. Co integration and Vector Error Correction Techniques were employed to empirically determine the impact of health spending on economic growth. The findings showed that several health policies had been put in place in Nigeria in the various development plans but some of the policies were not well implemented. For instance, in the fourth development plan, there was to be a provision of adequate and effective primary health care for the entire population and the goal was to achieve 80% coverage of the whole country by 1985 and 100% by the year 2000 but this was not fully achieved. The study further revealed that government spent more on payment of wages and salaries than on capital projects. Recurrent expenditure as a percentage of total health spending was 60% in 1978 and 84% in 2003 while capital expenditure was 40% in 1978 16% in 2003. The results of the Vector Error Correction Model showed that, the short run, the impact of health expenditure on economic growth did not converge to the long run growth (t = 3.09, p< 0.05). In the long run, health expenditure in real terms had a positive and significant impact on the economic growth (t = 4.56, p< 0.05). The findings also showed that private investment had a positive and significant influence on the economic growth (t = 31.86, p< 0.05) while the degree of openness had a negative and significant influence on the economic growth in the long run (t = -6.92, p< 0.05). The study concluded that there was high prospect for investment in health to boost economic growth if government invested more in this aspect of human capital rather than physical capital.
- ItemOpen AccessEffects of Human Capital Development on Economic Growth in Nigeria (1970-2004)(2015-04-15) Aremo, Adeleke GabrielThe study examined the pattern of investment in health and education and assessed their effects on economic growth with a view to analysing the effects of government investments in human capital on the growth process of the Nigerian economy. Secondary data were used for the study. Annual data on gross domestic product (GDP), capital expenditures on education and capital expenditures on health for the period between 1970 and 2004 were obtained from the statistical bulletins published by the Central Bank of Nigeria (CBN) and the Annual Abstract of Statistics published by the National Bureau of Statistics. Both descriptive statistics and econometric techniques were used to analyse the data. To avoid spurious regression, the time series properties of variables were subjected to stationarity test using Philips-Perron test and Augmented Dickey Fuller test. Cointegration test was applied to check for the long-run relationship among the integrated variables. The estimation techniques used were Ordinary Least Squares and Error Correction Model (ECM) P, The results of the study indicated that recurrent expenditures on education as percentage of total expenditure on education was on the average 67 percent, while the capital expenditure on education as percentage of total expenditure on education was 40.4 percent. The recurrent expenditure on health as a percentage of total expenditure on health was on the average 58.2 percent while the capital expenditure on health was 38.1 percent. The primary school enrolment formed a major part of the total school enrolment but with a relatively low growth rate of 1.00 percent on the average. The growth rates of secondary school enrolment and tertiary school enrolment averaged 2.5 percent and 2.8 percent respectively. The results also showed that capital expenditure on health was significantly and positively associated with economic growth (1=3.70, p<0.05). The capital expenditure on education was positively related to economic growth but not significant 0-0.18, p>0.05). The tertiary school enrolment variable was positively related to economic growth but not significant= (1=1.28, >0.05). The coefficient of error correction terra was -0.46 and was significant 0=3.16, p<0.05) and this implied that 46 per cent of any disequilibrium in economic growth in the previous year was adjusted for in the following year. The study concluded that effects of human capital development components of health and education were mixed. On the one hand, the health component impacted positively on the growth process; on the other hand, the education investment expenditure; had not contributed significantly to economic growth in Nigeria.