Oil price fluctuations and the Nigerian economy
AbstractThe single most important issue confronting a growing number of world economies today is the price of oil and its attendant consequences on economic output. Several studies have taken the approach of Hamilton (1983) in investigating the effect of oil price shocks on levels of gross domestic product. The focus of this paper is primarily on the relationship between oil price changes and economic development via industrial production. A vector auto regression model is employed on some macroeconomic variables from 1980 through 2004. The results indicate that oil price changes affect real exchange rates, which, in turn, affect industrial production. However, this indirect effect of oil prices on industrial production is not statistically significant. Therefore, the implication of the results presented in this paper is that an increase in oil prices does not lead to an increase in industrial production in Nigeria. Copyright 2005 Organization of the Petroleum Exporting Countries.
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Bibliographic InfoArticle provided by Organization of the Petroleum Exporting Countries in its journal OPEC Review.
Volume (Year): 29 (2005)
Issue (Month): 3 (09)
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Web page: http://onlinelibrary.wiley.com/journal/10.1111/%28ISSN%291753-0237
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- Oriakhi D.E & Iyoha Daniel Osaze, 2013. "Oil Price Volatility and its Consequences on the Growth of the Nigerian Economy: An Examination (1970-2010)," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(5), pages 683-702, May.
- Hamdi, Helmi & Sbia, Rashid, 2013. "Dynamic relationships between oil revenues, government spending and economic growth in an oil-dependent economy," Economic Modelling, Elsevier, vol. 35(C), pages 118-125.
- Zahid Muhammad & Hassan Suleiman & Reza Kouhy, 2011. "Exploring oil price – exchange rate nexus for Nigeria," FIW Working Paper series 071, FIW.
- Ding, Liang & Vo, Minh, 2012. "Exchange rates and oil prices: A multivariate stochastic volatility analysis," The Quarterly Review of Economics and Finance, Elsevier, vol. 52(1), pages 15-37.
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