IIARD International Institute of Academic Research and Development

JOURNAL OF PUBLIC ADMINISTRATION AND SOCIAL WELFARE RESEARCH (JPASWR )

E-ISSN 2504-3597
P-ISSN 2695-2440
VOL. 9 NO. 1 2024
DOI: https://doi.org/10.56201/jpaswr.v9.no1.2024.pg74.100

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A Simulation Analysis of President Bola Tinubu’s Price Deregulation Policy on the Nigerian Economy: An Outlook to Year 2035

Rex Oforitse ARUOFOR, Ph.D, Daniel Risiagbon OGBEIDE, Ph.D

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Abstract

The deregulation of economic activities which gathered momentum in this country in 1986 under the general programme of Structural Adjustment by the Military, has been a matter of intense debate among economists, other professionals and the public. Ever since the President Bola Tinubu administration came to power on May 29, 2023 in Nigeria, his policy has been consistent with deregulation. one of the earliest policies embarked upon was the removal of fuel subsidy with the attendant increase of domestic pump price of petrol to an average of N600.00/liter which has resulted in an unprecedented general price hike in commodities across the country. Now it will seem that the game plan of the administration all along was to deregulate prices and the general price level is now controlling the Nigeria economy. Deregulation represents a reduction or total elimination of government involvement in an industry. Protagonists of price deregulation argue that Deregulation lowers costs of operations, allows more businesses to enter a market, and lowers prices for consumers and that these factors can help stimulate efficiency and lead to increased economic growth. Critics on the other hand suggest that deregulation can lead to monopolies and hurt consumers. It is not clear which direction Nigeria is heading and that is why it is expedient to carry out a full and objective appraisal of the policy on the Nigeria economy a’la the Total Differential Modeling Approach (ecostatometrics). Indeed the result of this study corroborates most of the economic tenets of price deregulation policy but with attendant high costs to the masses of Nigeria. The economy will grow and there will be a decline in the general price level as predicted by economic theory. Corruption will reduce, with consumption, investment and capital accumulation increased. Output of agriculture, industry, manufacturing, services and trade will recor

keywords:

Total Differential Modeling Approach, price deregulation, Nigeria economy, economic growth, standard of living, purchasing power and absolute poor

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