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The Effect of Monetary Policy on Economic Development in Nigeria

Author

Listed:
  • Paul Atanda Orebiyi

    (Department of Economics, University of Uyo, Uyo, Nigeria)

  • Edidiong Prince Ekot

    (Department of Economics, University of Uyo, Uyo, Nigeria)

  • Etim Essien Bassey

    (Department of Economics, University of Calabar)

  • Christiana Uduak Ekong

    (Department of Economics, University of Uyo, Uyo, Nigeria)

Abstract

The Human Development Index was used as a proxy for development outcomes in examining the effect of monetary policy on economic development in Nigeria. Annual time series data spanning 1980 to 2023 were analyzed using the Fully Modified Ordinary Least Squares technique to assess long-run relationships. Findings reveal that money supply has a statistically significant and positive effect on human development at the 5% significance level, suggesting that well-managed monetary expansion can support development goals. The study recommends that the Central Bank of Nigeria adopt controlled money supply growth policies and review government expenditure to enhance welfare and support disadvantaged groups.

Suggested Citation

  • Paul Atanda Orebiyi & Edidiong Prince Ekot & Etim Essien Bassey & Christiana Uduak Ekong, 2025. "The Effect of Monetary Policy on Economic Development in Nigeria," East African Finance Journal, East African Finance Journal, vol. 4(3).
    • Handle: RePEc:cwk:eafjke:2025-25
    DOI: 10.59413/eafj/v4.i3.5
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    References listed on IDEAS

    as
    1. Gbatsoron Anjande & Simeon T Asom & Ngutsav Ayila & Bridget Ngodoo Mile & Victor Ushahemba Ijirshar, 2022. "Government Spending and Money Supply Roles in Alleviating Poverty in Africa," Papers 2209.14443, arXiv.org.
    2. Abdulrahman, Idris Abdulganiyu & Akanbi, Sa'ad Babatunde & Oniyide, Gbenga Daniel, 2023. "Impact of Monetary Policy on Poverty Reduction in Nigeria," African Journal of Economic Review, African Journal of Economic Review, vol. 11(01), January.
    3. Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
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