Food Inflation and Poverty Rate in Nigeria: An Autoregressive Distributive Lag Approach
Abstract
This study explores the relationship among food inflation, lending interest rate and poverty rate in Nigeria using the Autoregressive Distributed Lag (ARDL) model over the period 2000-2023. The results show that there is a significant positive relationship between food inflation and poverty rate in Nigeria. The findings also suggest that food inflation is a major contributor to the high poverty rate in the country as lending interest rate impacts negatively on poverty rate both in the short and long-run. In addition, the results indicate that the Breusch-Godfrey serial correlations LM test result has no serial correlation problem, and the heteroscedasticity result concludes that the residual variance is constant (Homoscedasticity.) Furthermore, the normality result shows that there is no significant deviation from the normal distribution and it concludes that the data are normally distributed. The study therefore recommends that policymakers should focus on implementation of effective measures to control food inflation in order to alleviate poverty in Nigeria
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