Effect Of Monetary Policy On Economic Growth In Nigeria
Need help with a related project topic or New topic? Send Us Your Topic
DOWNLOAD THE COMPLETE PROJECT MATERIAL
Effect Of Monetary Policy On Economic Growth In Nigeria
ABSTRACT
The goal of this study is to investigate the impact of monetary policy on economic growth in Nigeria. This study defined monetary policy as monetary management approaches implemented by the government through the central bank to control money supply in order to impact broad macroeconomic goals.
The data used is secondary data acquired from the Central Bank of Nigeria statistical bulletins between 1981 and 2014, and multiple regression analysis of ordinary least squares (OLS) was employed.
The model’s variables include GDP growth as the dependent variable, and broad money supply, interest rate, and monetary policy rate as independent factors. The results reveal that the money supply is statistically significant, implying that it has a beneficial impact on growth in Nigeria.
On the other hand, interest rates and monetary policy rates are statistically insignificant, indicating that they have a negative impact on Nigeria’s economic growth. In addition to monetary policy, the government should increase spending on productive industries to support economic growth.
Background Information.
Monetary policy refers to monetary management techniques implemented by the government through the central bank to control the money stock, or money supply, in order to influence broad macroeconomic objectives such as price stability, high levels of employment, long-term economic growth, and balance of payment equilibrium.
These broad aims are attained through the use of appropriate tools, depending on which target the policy is designed to fulfil in terms of the country’s level of development.
Over the years, the two most important purposes of monetary policy have frequently been inflation targeting and exchange rate regulation. These objectives have dominated the Central Bank of Nigeria’s monetary policy focus, with the premise that they are critical tools for attaining macroeconomic stability (Ajayi, 1999).
Need help with a related project topic or New topic? Send Us Your Topic