Investigating the implications of Unemployment and Inflation for Income Inequality in Nigeria (Published)
In developing countries, Nigeria inclusive, among the macroeconomic goals pursued by the government to ensure the well-being of the residents include attainment of full employment, price stability and equitable distribution of income. Available statistics in Nigeria reveal that income inequality level, unemployment and inflation rates have been increasing in recent years. This study examined the effect of increase in inflation and unemployment rates on income inequality in Nigeria for the period (1981-2023) using Autoregressive Distributed lag (ARDL) Bound Test Approach. The findings of the study show that both inflation and unemployment has significant positive relationship with income inequality in Nigeria. This implies that increase in inflation rate worsen income inequality problem in the country. It also indicates that increase in unemployment rate hikes income inequality level in the country. The interplay between unemployment, inflation and income inequality is a complex one in that if policymakers focus solely on maintaining low inflation, as directed by traditional Phillips curve it might inadvertently increase income inequality through high unemployment rate, and a policy that prioritizes on reducing unemployment level might hike inequality through high inflation rate. Hence, there is need for the government to adopt more adequate tools to fight inflationary pressure from different sources as well as curb unemployment. Among the recommendations include a judicious mix of monetary and fiscal strategies for achieving macroeconomic stability and inclusive economic development. Government policy should focus on increasing aggregate output in the economy through increase in productivity of the average worker and this can be achieved through lowering interest rate and provision of critical infrastructure especially electricity supply and road infrastructure to reduce cost of production and promote investment. Tax reduction is also recommended to stimulate consumption and investment spending, output and employment. Also, there should be increased government expenditure on education and health sectors as well as on social policies such as poverty alleviation and social protection.
Keywords: Income inequality, inflation rate, unemployment rate, Nigeria
Keywords: Income Inequality, Inflation Rate, Nigeria, unemployment rate
Income Inequality, Health Care Expenditure and Economic Performance in Nigeria (Published)
This paper examined the impact of income inequality and healthcare expenditure on economic performance in Nigeria over the period 1990-2020 using the Autoregressive Distributed Lag (ARDL) estimation technique. The findings reveal the existence of a positive and a statistically significant relationship between income inequality and economic performance as well as health care expenditure and economic performance in Nigeria. In addition, the results show that health care is a necessity rather than a luxury in Nigeria. The study recommends that government should implement programs and policies that will alleviate the inequality in income distribution as well as appropriate policies at the macroeconomic level targeted at public health expenditure to enhance economic performance
Keywords: ARDL, Economic Performance, Health Care Expenditure, Income Inequality, Nigeria
Understanding the Nexus between Foreign Institutional Loans and Income Inequality in Nigeria (Published)
This study examines the role of foreign institutional loans in reducing income inequality in Nigeria. Time series data spanning from 1980 to 2017 on each of the variables were sourced from the National Bureau of Statistics and World Development Indicators (WDI). The augmented Dickey Fuller (ADF) unit root test, Johansen multivariate cointegration approach, vector error correction model (VECM) and Granger causality tests were employed as techniques for data analysis. The ADF unit root test results reveal that the variables are all stationary upon first difference and as such they all I(1). The cointegration test results indicate that the variables have long run relationship. The estimated VECM shows that loans from the World Bank and African Development Bank impacted negatively on income inequality. This finding suggests that borrowings from the World Bank and African Development Bank are helpful in collapsing the disparity in the distribution of income within the Nigerian population. The Granger causality test results reveal that joint causality runs from the all the underlying foreign institutional loans to poverty and income inequality. Given the findings, it is recommended that the Federal Ministry of Finance in collaboration with the Debt Management Office (DMO) should ensure that loans sourced from foreign institutions are channeled into productive investments in order to foster rapid and sustained reduction in income inequality.
Keywords: African Development Bank, Federal Ministry of Finance and Debt Management Office., Foreign Institutional Loans, Income Inequality, world bank
ROLE OF POLICIES IN ECONOMIC GROWTH: A CASE STUDY OF CHINA’S ECONOMIC GROWTH (Published)
It is historical fact the economic policies play key role in the growth and downfall of different empires whether it was Muslim empires in Spain and India or British Empire, which ruled almost the whole world in 17th and 18th centuries. The emergence of China’s economic growth is the phenomena of 21st century. The author has intended to investigate the Chinese policies in different sectors as the drivers of economic growth during the period 1980-2010.The main objective of this research is to investigate different policies introduced by the Chinese government during 1980-2010 to promote economic growth and to measure their effect at micro and macro level of Chinese economy.The author used secondary date collected from different sources such as IMF,World Bank, Barro and Lee, OECD database, US Bureau of Labour Statistics, US Bureau of Economic Analysis, and relevant Journals. Our findings and results are robust because the evidence proves that different policies implemented by Chinese government have brought substantial positive impact on national economy at micro and macro level.
Keywords: FDI, GDP, Gini Co-Efficient, Income Inequality, Poverty Alleviation