The effects of oil shocks on government expenditures and government revenues nexus in Nigeria (with exogeneity restrictions)

Adedokun, Adebayo

doi:10.1016/j.fbj.2018.06.003

Cited by 45 publications

(50 citation statements)

References 21 publications

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“…It could be concluded that these two important measures of inflation rates were not determined within the economy since the economy relies much on importation of finished and intermediate goods for production. This result was consistent with Adedokun (2018) who argued that inflation was more of exogenously determined through undue demand for foreign products which drove up exchange rate.…”

Section: Cointegration Testsupporting

confidence: 89%

Exploring the Relationship between Consumer Price Index (CPI) and Producer Price Index (PPI) in Nigeria

Oyeleke¹,

Ojediran²

2018

ASSRJ

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The study investigated the relationship between consumer price index (CPI) and producer price index (PPI) in Nigerian economy, using monthly data from 2013: 01 to 2018: 05. The study employed DF-GLS unit root test to verify the stationarity of the series. Cointegration tests involving Johansen and Engle-Granger approaches could not detect long run relationship between CPI and PPI, implying that the variables could not be substituted for each other in measuring inflation rate in Nigeria. Vector Autoregressive (VAR) technique was used to analyse the variables and the results revealed that there was no causality between CPI and PPI in Nigeria. However, the OLS result in Engle-Granger 2-step approach to cointegration provided a useful insight into the relationship between the variables. An increase in either CPI or PPI exerted a statistically significant reduction effect on the rate of other in the long run.

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Section: Cointegration Testsupporting

confidence: 89%

Exploring the Relationship between Consumer Price Index (CPI) and Producer Price Index (PPI) in Nigeria

Oyeleke¹,

Ojediran²

2018

ASSRJ

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“…In Nigeria one of the major contributing factors for 2016 recession was fall in the price of oil coupled with decreased in quantity of production, the recession was accompanied by high inflation rate on basic commodities (cost-push) [16]. Monetary policy on inflation is always been informed by the general price level.…”

Section: Literature Reviewmentioning

confidence: 99%

“…According to [16,17], the economy of Nigeria was affected by the decline in the revenue due to a fall in the price of crude oil alongside production. They cited that in about twenty months, the oil price has nosedived rapidly from as high as about one hundred and thirty dollars per barrel to as low as twenty-eight dollars and quantity also dropped from 2.15 Mbpd to 1.81 Mbpd in the earlier months of 2016, this resulted to a recession.…”

Section: Introductionmentioning

confidence: 99%

“…Aside from the contribution to the growth rate, the industry affects monetary variable and high unemployment rate [2]. According to Nweze and Edeme [19], as quoted by Adedokun [16], CBN [20] opined that on average, 75% of government revenues and on average 93% of foreign earnings from trade in goods and services, in the last ten years come from oil export, which informs part of the major sources used in financing the country's imports.…”

Section: Introductionmentioning

confidence: 99%

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Impact of Oil Price Fluctuation on the Economy of Nigeria, the Core Analysis for Energy Producing Countries

Jelilov¹,

Jibrin²,

Çelik³

et al. 2022

Global Trade in the Emerging Business Environment

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The study aims to find the short-run empirical analyses of the impact of oil price fluctuation on the monetary instrument (Exchange rate, Inflation, Interest rate) in Nigeria. We explored the frequently used Toda–Yamamoto model (TY) model, by adopting the TY Modified Wald (MWALD) test approach to causality, Forecast Error Variance Decomposition (FEVD) and Impulse Response Functions (IRFs).The study covered the period 1995 to 2018 (monthly basis), and our findings from MWALD test indicated that there is a uni-directional causality of the log of oil price (lnoilpr) to log of the exchange rate (lnexchr) at 10% level of significance, also there is a contemporaneous response of log of consumer price index (lncpi) to log of exchange rate (lnexchr) and log of interest rate (lnintr), and jointly (lnoilpr, lncpi and lnintr) granger cause lncpi. Also at 5% level of significance lnintr responded due to positive change in lnoilpr and lnexchr, and jointly causes lnintr at 5% level of significance. This is complimented with our findings in FEVDs, and IRFs. The empirical analyses shows that oil price is a strong determining factor of exchange rate, cost of borrowing and directly influences inflationary or deflationary tendencies in Nigeria..

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“…In Nigeria, Olayungbo and Olayemi () submitted that non‐oil revenue has a positive impact on economic growth, while government spending has a negative impact economic growth. Adedokun () discovered that shocks in oil revenue influences government expenditure shocks both in long‐run and short‐run, while oil price shocks only influenced government expenditure in the long‐run.…”

Section: Review Of Related Literaturementioning

confidence: 99%

The impact of oil price and revenue variations on economic growth in Nigeria

2018

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The study investigates the relationship between oil price, revenue variation and economic growth in Nigeria. The study makes use of a secondary data spanning 1981 and 2016. The Auto‐regressive Distributed Lag was used to analyse the long‐run and short‐run relationship among the variables. The short‐run result shows that oil price and oil revenue positively significantly relates with economic growth, while consumer price index and exchange rate negatively relates with economic growth. In the long‐run, oil price, consumer price index and exchange rate positively relates with economic growth, while oil revenue negatively relates with economic growth. This implies that oil revenue has not been channelled in the direction of enhancing growth in Nigeria, while oil price has been in favour reason been that it determines a larger percentage of the country's revenue. From the findings, the study concludes that variations in oil price and oil revenue are strong determinant factors of economic growth in Nigeria. A major recommendation is that, oil revenue should be restructured towards the strategic sectors of the economy to aid the growth in Nigeria.

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The effects of oil shocks on government expenditures and government revenues nexus in Nigeria (with exogeneity restrictions)

Cited by 45 publications

References 21 publications

Exploring the Relationship between Consumer Price Index (CPI) and Producer Price Index (PPI) in Nigeria

Exploring the Relationship between Consumer Price Index (CPI) and Producer Price Index (PPI) in Nigeria

Impact of Oil Price Fluctuation on the Economy of Nigeria, the Core Analysis for Energy Producing Countries

The impact of oil price and revenue variations on economic growth in Nigeria

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