Submit your papersSubmit Now
For Enquiries: [email protected]
IIARD LogoIIARD

Money Supply, Inflation and Economic Growth in Nigeria

Asuquo Ekpeyong, Emefiele Charles, Olugbemi Kolawole O. & Ita Richard Ita

Abstract

The study empirically investigated money supply, inflation and economic growth in Nigeria. The specific objectives were to; determine the effect of broad money supply, inflation, interest rate, labor supply on the growth of Nigerian economy, using GDP as a proxy. Annualized time series data from the CBN statistical Bulletin, 2018 were obtained for the study. Ordinary least square multiple regression statistical technique was adopted in the analysis of data. Results indicated that money supply had positive and significant effect on economic growth in Nigeria during the period. The study also revealed that inflation, labor supply, interest rate had positive and insignificant effect on economic growth in Nigeria. The implication is that broad money together with price can facilitate economic growth. Based on these results, it was recommended that government should sustain the deepened financial system for continuous flow of funds across the sector of the economy

Keywords

Money supplyInflationInterest ratelabor supplyGDP

References

Ahuja, N. (2010), “Economic growth and the problem of inflation” Economica, New Series,. 26, ( 104), 287-298. Amassona, S., (2011). Money supply and the growth of emerging economy, Journal of. Applied Economics., 14: 563-577.| Asinya, P. (2004), Money, output and price level. Economic and Political Weekly, 26,(24),.1472-1474. Aslam M. O. (2016), Financial intermediation and economic growth in Developing Countries. Journal of Economic Studies, 25(3): 203–234. Bernard, O., (2010), M2 Targeting, money demand and real GDP growth in Nigeria: Do Rules Apply. Journal of Business and Public Affair, 1(2): 25-34. Blanchard, , S. (2009), “Money, inflation, and the Monetarist explanation: Evidence from the Postwar U.S. Experience” Eastern Economic Journal, 8,( 2,) . 101-119. El-seound, , M., (2014). A monetarist analysis of the generation and transmission of world inflation: International journal of Economics.., 67: 164-171. Falaiye, M. (2011), “Inflation and economic growth,” Journal of Political Economy, 75, 796-810. Fischer, S. (1983), “Inflation and growth” NBER Working Paper Series No. 1235. Ihsan, P,Anjum, M. (2013), Bounds testing approaches to the Analysis of level relationships. Journal of Applied Econometrics 16 (3), 289–326. Imoughele J. L. (2014), “Money and capacity growth” The Journal of Political Economy, 74, ( 5), 451-465. Inam, O, M..,(2014). A modelling of Ghana's inflation experience. International Journal of banking and finance.1(2),23-34 Inam..,R., Ime, S.M.. (2017), “Alternative economic approaches for analysing the role of the financial sector in economic growth. Time series evidence from LDC’s”. Journal of Development Economics, 50(1): 119- 146. Ireland, K. (2014). Money and economic growth” Econometrica, 38,( 1),. 171-175. Isiaka, T.(2011). Money supply and economic growth in Nigeria. Journal of Finance,1(2),23-45. Jawaid, , M. Gadri,G.,Ali,Y. (2011), “Equilibrium and disequilibrium growth with money—the Tobin Models” The Review of Economic Studies, 38, ( 4). 457-479. Ladler, D. A. (20044), “Relative prices and money: A vector autoregression on Brazilian data” American Journal of Agricultural Economics, 66, ( 1), . 25-30. Lucas, K. P. (2016), “The saving and investment Nexus for China: Evidence from cointegration Tests.” Applied Economics, 37: 1979–90. McConnell,, Brue R. (2005), “Financial development and growth: Views and agenda”. Journal of Economic Literature, 35: 688-726. Moroney, J. R. (2012), Money growth, output growth, and inflation: Estimation of a modern quantity. Theory Southern. Economic Journal, 69,( 2) . 398-413. Njimanted, , P. Akume,, Mukete P. (2016), “Is inflation always and everywhere a monetary phenomenon?” The Scandinavian Journal of Economics, 107,( 2),. 239-259. Nnanna, S. (2001), “Warning: inflation may be harmful to your growth” International monetary fund staff papers, 45,( 4), 672-710. Nouri., C., Samimi Y. (2011), “Money supply, economic growth and inflation of China: 1998-2007,”.International joint conference on computational sciences and optimization. Ogunmuyiwa, E., Ekore, J. (2010), “Money and economic growth” Econometrica, . 33,(4), 671-684. Ogunmuyiwai, M. (2010), “Rational choice and patterns of growth in a monetary economy” American Economic Review, 57, 534-544. Owolabi, U. (2014). Inflation in latin America: A new era. Stanford Institute for Economic Policy Research Summit, Stanford, California, USA. Presert, K.Kachana, A.,Chukut, S., Morekeu, T (2015), “Do standards of living converge? Some cross-country evidence”. Economic Letters.. 43,( 2), 149-155. Sidrauski, S. (2017), “Estimating income and price elasticities of imports for Fiji in a cointegration framework,” Economic modelling, elsevier, 22(3), 423-438. Taiwo, A. O. (2011), Stylised facts on demand for money in Nigeria. Publication of economic associates in social science Research network (SSRN). Culled from the internet. (http://papers.ssrn.com/sol3/ papers.cfm?abstract_id=874628) March 14, 2010. Todaro., A., Smith E. (2009), “Inflation and welfare” Econometrica, 68,( 2),. 247-274. Twinoburyu, P. N.,Odhiambo, R (2017), “Money and growth: An alternative approach” The American Economic Review, 84,( 1). 47-65. Uduakobong, A.C., (2014). The dynamics of inflation in Chile. In: Measurement in economics: Studies in mathematical economics and econometrics in memory of Yehuda Grunfiled, Woods M. A. (1980), “An econometric analysis of the main determinants of Nigeria money Supply, Journal of Economics Dynamic and Control 12: 231-254

More Articles from IIARD INTERNATIONAL JOURNAL OF BANKING AND FINANCE RESEARCH

Effect of Monetary Policy on Profitability of Deposit Money Banks in Nigeria

Author: Stephanie Nguhemen Gbande, Mike T. Soomiyol, Timothy Tyona, Gaius Msendoo Asombo

Cognitive Diversity and Performance of Deposit Money Banks in Nigeria

Author: 1Nwangwu, Okwudiri Iheanyi, 2 Pepple, Grace Jamie PhD

Banking Innovations and Industrial Sector Performance in Nigeria: Evidence from ARDL Model

Author: Peter Ngbede Ajam, Abiodun Edward Adelegan, Benson Emmanuel

Environmental Sustainability and Entrepreneurial Performance in Nigeria: A Case Study of Enugu State

Author: i, Azolike Nkiru Nkechi, ii, Okwor Emmanuel Ejimnkonye, iii, Eneaniofu Daniel Mmaduakonam