ECONOMIC INDICATORS AND GROWTH OF THE NIGERIAN ECONOMY

Author: Akparhuere, Godwin Oghenekohwo, Ph.D.

ABSTRACT

The main objective of this study was to assess the impact of economic indicators on the economic growth of Nigeria. The specific objectives were to: Ascertain the impact of the balance of trade on Nigeria’s economic growth; Verify the impact of taxation on Nigeria’s economic growth; Evaluate the effect of consumer prices on Nigeria’s economic growth; and investigate the effect of the unemployment rate on Nigeria’s economic growth. The study adopted the ex post facto research method and a sample of 10 years was drawn (2013-2022). The data used for the analysis were collected through secondary sources. The method of analysis is the linear regression model whereby the dependent variable was economic growth (proxy by real GDP) while the independent variables were proxy by the balance of trade (BOT), inflation rate (INFL), consumer price index (CPI), and unemployment rate (UR). Findings from the study revealed that: (i) p-value = 0.784 > 0.05, therefore we did not reject hypothesis H1 but concluded that balance of trade has no significant impact on Nigeria’s economic growth; ii) p-value = 0.022 < 0.05, hence we rejected H2 and concluded that inflation rate has significant impact on economic growth in Nigeria; iii) p-value 0.000 < 0.05, we did not accept H3 but we concluded that CPI has a significant impact on economic growth in Nigeria; and iv) p-value = < 0.002 we did not accept H4 but we concluded that unemployment rate has a significant impact on economic growth in Nigeria. The study recommended that: i) Nigeria should intensify effort to improve on her exports and make it bigger that its imports; ii) The government should address the challenge of the inflation rate in Nigeria by using appropriate fiscal and monetary policies that will address excess liquidity in the system; iii) The high costs or prices of goods should be checked; iv) Government and individual firms should encourage job creation for the teeming youths of this country. The contribution to knowledge is that the concepts of economic indicators and economic growth have been empirically adjudged as useful measures of performance of the Nigerian economy. The study concluded that there is a tendency that some levels of risk in the economy could be reduced when the behaviour of these variables are estimated correctly.

Keywords: Impact, Economic Indicators, Economic Growth, Nigeria.

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