IDEAS home Printed from https://ideas.repec.org/p/aer/rpaper/rp_182.html
   My bibliography  Save this paper

Modelling the Inflation Process in Nigeria

Author

Listed:
  • Olusanya E. Olubusoye
  • Rasheed Oyaromade

Abstract

This study is motivated by the conviction that inflation entails sizeable economic and social costs, and controlling it is one of the prerequisites for achieving a sustainable economic growth. The study analyses the main sources of fluctuations in inflation in Nigeria. Using the framework of error correction mechanism, it was found that the lagged CPI, expected inflation, petroleum prices and real exchange rate significantly propagate the dynamics of inflationary process in Nigeria. The level of output was found to be insignificant in the parsimonious error correction model. Surprisingly, the coefficient of the lagged value of money supply was found to be negative and significant only at the 10% level. One of the major implications of this result is that efforts of the monetary regulating authorities to stabilize the domestic prices would continuously be disrupted by volatility in the international price of crude oil.

Suggested Citation

  • Olusanya E. Olubusoye & Rasheed Oyaromade, 2008. "Modelling the Inflation Process in Nigeria," Research Papers RP_182, African Economic Research Consortium.
  • Handle: RePEc:aer:rpaper:rp_182
    as

    Download full text from publisher

    File URL: http://www.aercafrica.org/documents/RP182.pdf
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dick Durevall & Bo Sjö, 2012. "Working Paper 151 - The Dynamics of Inflation in Ethiopia and Kenya," Working Paper Series 400, African Development Bank.
    2. repec:ibn:ibrjnl:v:10:y:2017:i:12:p:1-21 is not listed on IDEAS
    3. Njimanted, Godfrey Forgha & Nkwetta Ajong Aquilas, 2015. "The Impact of Timber Exports on Economic Growth in Cameroon: An Econometric Investigation," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 3(3), pages 46-60, September.
    4. Durevall, Dick & Loening, Josef L. & Ayalew Birru, Yohannes, 2013. "Inflation dynamics and food prices in Ethiopia," Journal of Development Economics, Elsevier, vol. 104(C), pages 89-106.
    5. Temitope Leshoro & Umakrishnan Kollamparambil, 2016. "Inflation Or Output Targeting? Monetary Policy Appropriateness In South Africa," PSL Quarterly Review, Economia civile, vol. 69(276), pages 77-104.
    6. repec:khe:scajes:v:3:y:2017:i:2:p:68-75 is not listed on IDEAS

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aer:rpaper:rp_182. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Steven Kinuthia). General contact details of provider: http://edirc.repec.org/data/aerccke.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.