Analysis of inflation and its determinants in Nigeria

Ibrahim Odusanya and Akinwande Atanda

MPRA Paper from University Library of Munich, Germany

Abstract: The study critically analyzed the dynamic and simultaneous inter-relationship between inflation and its determinants in Nigeria between 1970 and 2007. The time series variables properties were examined using the Augmented Dickey Fuller (ADF) unit root test and the result reveals that inflation rate, growth rate of real output and money supply, and real share of Fiscal deficit are stationary at levels, while other incorporated variables in the empirical analysis- real share of Import, Exchange rate and Interest rate-are stationary at first difference. The long-run and short-run mechanism of interaction between inflation and its determinants were examined usig the Augmented Engle-Granger (AEG) cointegration test and Error Correction Mechanism (ECM) model respectively.

Keywords: Inflation; determinants; unit root; cointegration; error correction model; Nigeria economy (search for similar items in EconPapers)
JEL-codes: B41 C01 C22 E00 E31 (search for similar items in EconPapers)
Date: 2010
References: View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Published in Pakistan Journal of Social Sciences 2.7(2010): pp. 97-100

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