Open AccessThe impact of fiscal policy on inflation in Nigeria
Author(s) -
Godly Otto,
Wilfred I. Ukpere
Publication year - 2015
Publication title -
risk governance and control: financial markets and institutions
Language(s) - English
Resource type - Journals
eISSN - 2077-4303
pISSN - 2077-429X
DOI - 10.22495/rgcv5i1c1art5
Subject(s) - inflation (cosmology) , economics , monetary policy , government (linguistics) , ordinary least squares , fiscal policy , order (exchange) , work (physics) , macroeconomics , central bank , monetary economics , finance , econometrics , mechanical engineering , linguistics , philosophy , physics , theoretical physics , engineering
Inflation is a major problem in Nigeria. To stabilize the economy, policy makers have often used fiscal and monetary policies to address inflation. For efficacy of policy, it is important to know the likely influence of each of these on inflation in order to properly prescribe a solution. This work attempts to see the impact of fiscal policy on inflation. This is necessary because of the current demands of the Academic Staff Union of Universities (ASUU), which is likely to increase government spending and possible inflation. Using data from the Central Bank of Nigeria spanning 32 years, the study used an ordinary least squares regression analysis, and observed that fiscal policy impacts on inflation but such impact is not significant. Therefore, government may on the basis of this study, implement the agreement it had with the Academic Staff Union of Universities without the fear of inflation.