Impact of Oil Price Volatility on Macroeconomic Variables and Sustainable Development in Nigeria
Mathias Eneji,
Mai-Lafia Dimis Inusa and
Nnandi Drenkat Kennedy
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Mai-Lafia Dimis Inusa: Department of Economics, University of Jos, Nigeria
Nnandi Drenkat Kennedy: Department of Economics Education, University of Jos, Nigeria
International Journal of Economics and Financial Research, 2016, vol. 2, issue 2, 33-40
Abstract:
The main objective of this study is to determine the impact of oil price volatility on macroeconomic variables and sustainable development in Nigeria. The significant role of oil in the Nigerian economy cannot be overestimated. Though there are studies by other researchers on oil prices and macroeconomic variables, their findings are contentious and country-specific. Our literature review and methodology shade lights on these positions. We used secondary time series data in a vector auto regression analysis. We found that fluctuations in oil prices do substantially affect the real GDP, exchange rates, Unemployment, Balance of payments and interest rates in Nigeria. Negative shocks in the international oil market, have significant impact on price fluctuations. Due to increased imports in the Nigerian economy, inflationary pressures are inevitable and are pronounced. Government revenues and expenditures have decreased significantly. We recommend diversification of the economy and energy sources for sustainable development in Nigeria.
Keywords: Exchange rates; Unemployment; Inflation; Balance of payments; Real GDP; Government revenue; Sustainable development. (search for similar items in EconPapers)
Date: 2016
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