Investigating Fiscal Dominance in Nigeria

Sanusi, Kazeem Abimbola; Akinlo, Anthony Enisan

doi:10.5539/jsd.v9n1p125

Cited by 13 publications

(21 citation statements)

References 14 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…K. Sanusi and A. Akinlo (2015) [12] proposed their own approach to defining fiscal dominance in macroeconomic policy. Their research refers to the work by M. Fratianni and F. Spinelli (2001) [13], based on the assumption that the causal relationship between the budget deficit and the increase in the monetary base in the economy is direct.…”

Section: Literature Review: Theoretical Premises Of Fiscal Dominance mentioning

confidence: 99%

Solving Fiscal Problems through Monetary Policy Mechanisms: Case of Armenia

Voskanyan

Paronyan

2020

jour

View full text Add to dashboard Cite

Section: Literature Review: Theoretical Premises Of Fiscal Dominance mentioning

confidence: 99%

Solving Fiscal Problems through Monetary Policy Mechanisms: Case of Armenia

Voskanyan

Paronyan

2020

jour

View full text Add to dashboard Cite

“…A robust understanding of the fiscal system demands adequate and coherent explanation on the trend and the pattern of revenue and expenditure over time (Ayodele & Falokun, 2003;Sanusi & Akinlo, 2016). The economy was feeble and crisis prone at the beginning of self-rule in1994.…”

Section: Some Stylized Factsmentioning

confidence: 99%

On the relation between government expenditure and revenue in South Africa: An empirical investigation in a nonlinear framework

Sanusi

2020

Cogent Economics & Finance

Self Cite

View full text Add to dashboard Cite

The study explores the nonlinear linkage between government expenditure and government revenue using quarterly data from the first quarter of 1965 to the second quarter of 2019. Linear models are first deployed to determine the order of integration of the variables, cointegration, granger causality and variance decomposition within the SVAR model. Nonlinear techniques are employed to spot the asymmetric relation of the univariate and the expenditure and revenue linkage. Asymmetric adjustments are carried out to unknot the dynamic mechanism based on the threshold vector autoregressive model (TVAR) and threshold vector errorcorrection model (TVECM). Finally, the Markov Switching model is employed to determine the tendency of the variables to remain in a particular region and their transition probabilities. The empirical findings suggest the presence of nonlinear but one-way causal relation between government expenditure and revenue. The results show that adjustment mechanism of government expenditure towards the equilibrium is more persistent than government revenue when the threshold level is attained.

show abstract

“…In terms of empirical interrogation, the evidence on policy capture remains mixed. Afolabi and Atolagbe (2018), Sanusi and Akinlo (2016), Oladipo and Akinbobola (2011) have established the absence of monetary policy capture in Nigeria; whilst Anfofum, Yahaya and Suleman (2015) and Ozurumba (2012) have reported its presence. From the rest of the world, there are empirical studies that substantiates the unsettled evidence of fiscal dominance: Chaudhary and Ahmad (1995), Jean-Claude ( 2005), De Resende and Rebei (2008), Makochekanwa, (2011), Keen and Wang (2013), and Koyuncu (2014 found monetary policy capture from fiscal actions, while Kaur (2018) provided contrary results.…”

Section: Introductionmentioning

confidence: 99%

Welfare Effect of Monetary Financing

Shitile¹,

Sule²

2019

AEF

View full text Add to dashboard Cite

This study ascertained the direction and asymmetric pass-through of central bank’s monetary financing to welfare in Nigeria using annual time series data covering the period 1970 to 2018. The study depended on both the Monetarist and Keynesian theoretical postulations to provide insights on the policy significance of monetary financing. To undertake the empirical analysis, the study applied both the linear Autoregressive Distributed Lag (ARDL) and non-linear ARDL (NARDL) technique. Unlike the ARDL equation, the estimated NARDL equation established that welfare losses respond negatively to both positive and negative changes in monetary financing; but the impact of negative monetary financing shock (7.11) is greater than the positive shock (2.87). In addition, the study found that it takes about 9 to 11 quarters for the changes in positive and negative monetary financing to fully release its effects on welfare loss. Besides, the results revealed that welfare loss is also driven by oil price, which is suggestive from oil price pass-through to domestic prices (exchange rate and consumer prices). The study, therefore, supports monetary financing in proper amounts and conditions to boost aggregate nominal demand but not to spur a fully-fledged monetary policy capture in the process.

show abstract

Investigating Fiscal Dominance in Nigeria

Cited by 13 publications

References 14 publications

Solving Fiscal Problems through Monetary Policy Mechanisms: Case of Armenia

Solving Fiscal Problems through Monetary Policy Mechanisms: Case of Armenia

On the relation between government expenditure and revenue in South Africa: An empirical investigation in a nonlinear framework

Welfare Effect of Monetary Financing

Contact Info

Product

Resources

About