Economic Analysis of Borrowing, Corruption and Inflation in Nigeria (Published)
This study investigates the impact of borrowing and corruption on inflation in Nigeria. with annual time series data over the period 1990 to 2022 obtained from CBN statistical bulletin 2022, World Bank Economic Outlook 2022 were employed. This study employed two distinct analytical techniques namely the Error Correction technique. The results indicate that external debt could result in inflation or reduce inflation depending on the prevailing economic condition. On the other hand, domestic debt has a positive influence on the country’s inflationary woes as increase in domestic debt produces increase in inflation. Also the study finds that corruption increase the cost of goods and services and external debt could result in inflation or reduce inflation depending on the prevailing economic condition. The findings also show that domestic debt has a positive impact on inflation as such, increase in domestic debt increase in inflation. The recommends that in order to reap the benefits of foreign debt and reduce the debt load, the Nigerian government must secure political and economic stability and additionally, the nation’s ongoing democracy and the battle against corruption should be maintained.
Keywords: Corruption, Inflation, borrowing, fiscal theory, price level, pubic deficit
Analysing Stock Market Reaction to Macroeconomic Variables: Evidence from Nigerian Stock Exchange (NSE) (Published)
This study examined the impact of some selected macroeconomic variables on stock market performance in the Nigerian Stock Exchange (NSE). The study adopted all share index (ASI) as proxy for stock market performance and the dependent variable, while the selected macroeconomic variables included broad money supply (BMS), interest rate (ITR), inflation rate (IFR), and exchange rate (EXR) used as the independent variables. Secondary data for the variables was sourced from Central Bank of Nigeria (CBN) Statistical Bulletins covering the period 1985 to 2017. The study employed multiple regression technique, Augmented Dickey-Fuller unit root test, Johansen co-integration test and Error Correction Model (ECM) based on the E-views 9.0 software as methods of data analysis. The analysis of data revealed that a long-run equilibrium and short-run dynamic relationships existed between the selected macroeconomic variables and stock market performance in the Nigerian Stock Exchange. Overall, the empirical results showed that all the independent variables had significant influence on stock market performance. The impact of the individual macroeconomic variables indicated that broad money supply and exchange rate had significant positive effect on all share-index, while interest rate and inflation rate exhibited an inverse relationship with all-share index. Based on the findings, the study recommended that the monetary authorities should put in place sound monetary policies that would bring about positive developments in the stock market.
Keywords: All share index, Exchange Rates, Inflation, Interest, Money Supply, Stock Market