The Relationship between Inflation and Economic Growth in Nigeria: A Conceptual Approach
Journal Title: Asian Research Journal of Arts & Social Sciences - Year 2017, Vol 3, Issue 1
Abstract
The rate of inflation over the last three decades in Nigeria has significantly increased thereby affecting the macroeconomic growth and international competitive drive of the growing economy. The magnitude of this inflationary trends may be largely explained by the rapid growth of money supply motivated by the expansionary fiscal policies of the public sector, in addition to exchange rate fluctuation and poor diversification of the economy. After numerous attempt by successive administrations to regulate this economic problem using both monetary and fiscal policies, efforts seems to be abysmal. As a result, this paper is designed to explore the inflationary trend in Nigeria with the view to determining it impact on economic growth. The study adopted a descriptive method and further utilised charts to show the inflationary trend and GDP growth in order to provide better understanding on how inflation rates in Nigeria affects the desired level of economic growth. This is necessary because identifying the possible relationship between inflation and economic growth may expedite the process of realising the feasible policy options to be adopted towards achieving sound macroeconomic growth in Nigeria. This study therefore concludes that the current inflationary trend in Nigeria is negatively affecting the realisation of sustainable growth and development. This implies that one of the necessary requirement for attaining the desired growth level in Nigeria is to control the excessive increase in inflation rate. As a recommendation, there is need for the public sector to design a suitable framework that will encourage local producers to engage in innovative economic activities. This will creates a platform for creativity and manufacturing of commodities with international competitive advantage. The multiplier effects of this approach will undoubtedly increase the export volume of the growing economy, raise productivity level and competitive drives, reduce the exchange rate fluctuation, increase employment creations, raise income growth and economic welfare, and largely the fiscal prudence and macroeconomic growth.
Authors and Affiliations
Miftahu Idris, Rosni Bakar
Keywords
Related Articles
- EP ID EP338611
- DOI 10.9734/ARJASS/2017/33365
- Views 345
- Downloads 0
The Pursuit of Good Governance and the Anti-Financial Corruption Blitz in Nigeria: A Study of the Economic and Financial Crimes Commission (EFCC) (2003-2016)
The study examines the extent to which the Economic and Financial Crimes Commission (EFCC) has been able to tackle financial corruption and its gangrenous effects in Nigeria between 2003 and 2016. The study relied on sys...
Modern Perspectives on Environmentalism: Ecocentrism and Technocentrism in the Nigerian Context
The evolution of environmentalism in the 21st century has taken an anthropocentric viewpoint despite global calls for instituting sustainable development which should provide the required equilibrium. Therefore, environm...
Are New Generation of Students of Healthcare Management Focused on Social Entrepreneurship? A Field Study
This study aims to analyse students’ social entrepreneurship profiles and to compare them in their levels of social entrepreneurship with students having no bias towards social entrepreneurship. Social Entrepreneurship L...
The Impact of Umuada Group (The Powerful Daughters) in Umuorah-Umuohiri
The role of community development as well as conflict resolution is not one issue strictly reserved for men as some groups of women have in the past shown that these tasks can also be handled by women. One of such groups...
Investigating the Determinants of Child Malnutrition in Cameroon: Evidence from the Second Cameroonian Household Consumption Survey
Background/Objectives: This paper assesses the impact of household consumption spending on the nutritional status of children as measured by height-for-age, weight-for- age, and weight-for-height Z-scores, while controll...