Oil Price Shock and Macroeconomic Performance in Nigeria: Implication on Employment

Abiola John Asaleye, Charity Aremu, Adedoyin Isola Lawal, Adeyemi A. Ogundipe, Henry Inegbedion, Olabisi Popoola, Adewara Sunday and Olusegun Barnabas Obasaju
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Abiola John Asaleye: Department of Economics, Landmark University, Nigeria,
Charity Aremu: Department of Crop and Social Sciences, Landmark University, Nigeria
Adedoyin Isola Lawal: Department of Accounting and Finance, Landmark University, Nigeria,
Adeyemi A. Ogundipe: Department of Economics, College of Business and Development Studies, Covenant University, Nigeria,
Henry Inegbedion: Department of Business Studies, Landmark University, Nigeria.
Olabisi Popoola: Department of Economics, Landmark University, Nigeria,
Adewara Sunday: Department of Economics, Landmark University, Nigeria,
Olusegun Barnabas Obasaju: Department of Economics, Landmark University, Nigeria,

International Journal of Energy Economics and Policy, 2019, vol. 9, issue 5, 451-457

Abstract: Reduction in oil price in the international market, coupled high demand of foreign goods and wide swings of oil prices in the international market has posed different challenges for policies to promote growth and development. This study investigates the impact of oil shock on macroeconomic performance in Nigeria using Structural Vector Autoregression and normalized equation was used to establish the long-run equation. Evidence from the long-run relationship showed that employment has a negative relationship with aggregated output, exchange rate and oil prices. The interest rate and consumer price index has a positive relationship with employment. Variation in oil shock affects most of the macroeconomic variables. More explicitly, the oil price shock shows more variation across the time horizon for employment. The consequence of the result is that dependence on the oil sector has not promoted employment generation over time; there is a need to consider an alternative means to ensure sustainable growth and development.

Keywords: Oil Price; Employment; Macroeconomic Performance (search for similar items in EconPapers)
JEL-codes: F62 Q43 Q52 (search for similar items in EconPapers)
Date: 2019
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