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The impact of monetary and fiscal policy on the climate investment in Nigeria

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  • Charles C. Okeke
  • Awogbemi Clement Adeyeye

Abstract

This study aims to show the response of foreign direct investment (FDI) inflows to monetary policy (represented by money supply and interest rate) and fiscal policy (represented by tax revenues) in Nigeria during the period (1990–2021). The autoregressive distributed lag approach is employed to estimate long‐run relationship among variables. The results indicate that there is cointegrating long‐run relationship among the study variables. The study provides empirical evidence showing that an increase in the percentage of money supply to gross domestic product (GDP) by (0.971%) leads to a decrease in the percentage of FDI inflows to GDP by (0.975%), an increase in the percentage of tax revenues to GDP by (4.256%) leads to a decrease in the percentage of FDI inflows to GDP by (0.975%), an increase in interest rate by (1.164%) leads to decrease in the percentage of FDI inflows to GDP by (0.975%), and an increase in inflation rate by (0.329%) leads to increase in the percentage of FDI inflows to GDP by (0.905%).

Suggested Citation

  • Charles C. Okeke & Awogbemi Clement Adeyeye, 2024. "The impact of monetary and fiscal policy on the climate investment in Nigeria," Natural Resources Forum, Blackwell Publishing, vol. 48(4), pages 1259-1277, November.
    • Handle: RePEc:wly:natres:v:48:y:2024:i:4:p:1259-1277
    DOI: 10.1111/1477-8947.12363
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    References listed on IDEAS

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    4. Dikau, Simon & Volz, Ulrich, 2021. "Central bank mandates, sustainability objectives and the promotion of green finance," Ecological Economics, Elsevier, vol. 184(C).
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    6. World Bank, 2013. "World Development Indicators 2013," World Bank Publications - Books, The World Bank Group, number 13191, April.
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    1. Mwoya Byaro & Anicet Rwezaula & Jackson Bulili & Romanus Dimoso, 2025. "Assessing Monetary and Fiscal Policy Measures to Promote the Sustainability of Domestic and Foreign Direct Investment in Sub‐Saharan Africa," World Affairs, John Wiley & Sons, vol. 188(4), December.

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