Long-Run Determinants of Nigerian Inflation Rate: ARDL Bounds Testing Approach-Reference-Cited by-同舟云学术

Long-Run Determinants of Nigerian Inflation Rate: ARDL Bounds Testing Approach

Published:2021-11-10 Issue: Volume:18 Page:1370-1379
ISSN:2224-2899
Container-title:WSEAS TRANSACTIONS ON BUSINESS AND ECONOMICS
language:en
Short-container-title:

Author:

Abonazel Mohamed R.¹,Awwad Fuad A.²,Nwuju Kingdom³,Lukman Adewale F.⁴,Lekara-Bayo Ifeoma B.³,Atanu Enebi Y.⁵

Affiliation:

1. Department of Applied Statistics and Econometrics, Faculty of Graduate Studies for Statistical Research, Cairo University, EGYPT

2. Quantitative Analysis Department, College of Business Administration, King Saud University, Riyadh, SAUDI ARABIA

3. Department of Mathematics, Rivers State University, Port Harcourt, NIGERIA

4. Biostatistics and Epidemiology, University of Medical Sciences, Ondo, Ondo State, NIGERIA

5. Department of Statistics, Federal Polytechnic of Oil and Gas, Bonny Island, Rivers State, NIGERIA

Abstract

Inflation is a problem in all facets of life and all economic entities. The government of any nation is concerned with ensuring that her plans are not frustrated by unpredictable and galloping prices. This paper studies the dynamic causal relationship between inflation rate (measured by consumer price index (CPI)), exchange rate, gross domestic product (GDP), money growth, and oil export in Nigerian during 2005: Q1 to 2019: Q4. The ARDL bounds testing approach and error correction model were used to verify whether there was a long-term relationship between the inflation rate and four determinants (exchange rate, GDP, money growth, and oil export). The results of our study showed that the current inflation CPI, the exchange rate, GDP, and money growth would still affect the next quarter's inflation rate in Nigeria. However, the oil export has no significant effect on the inflation rate. Moreover, we find the long-run cointegration relationship between inflation CPI, the exchange rate, and money. The cointegration relationship will be achieved in a short time (during the next two quarters of the year).

Publisher

World Scientific and Engineering Academy and Society (WSEAS)

Subject

Economics and Econometrics,Finance,Business and International Management

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