Monetary Policy Transmission and Industrial Sector Growth: Empirical Evidence From Nigeria

Ezeaku, Hillary Chijindu; Ibe, Imo G.; Ugwuanyi, Uche Boniface; Modebe, Nwanneka J.; Agbaeze, Emmanuel Kalu

doi:10.1177/2158244018769369

Cited by 20 publications

(12 citation statements)

References 23 publications

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“…While Inflation has a positive sign but insignificance, interest rate on the other hand has negative effect on economic growth during the review period. Ezeaku et al (2018) assess the effects of monetary policy transmission channels on industrial growth in Nigeria within the period 1981-2014. The study adopted Johansen cointegration and the error correction model (ECM).…”

Section: Literature Reviewmentioning

confidence: 99%

Efficacy of Monetary Policy Instruments on Economic Growth: Evidence from Nigeria

Tule¹,

Ogundele²,

Apinran³

2018

Asian Economic and Financial Review

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The inability of monetary policies to efficiently and effectively exploit its policy objective could be a function of the pitfall of policy instruments adopted which seems to restrict its contributions to economic advancement in Nigeria. It is on this premise that this study investigated the efficacy of monetary policy instruments in Nigeria using monthly data from year 2000 to 2016. The study adopted the Johansen Multivariate Cointegration approach and Vector Error Correction (VECM). The Cointegration test established existence of long-term relationship between monetary policy instruments and economic growth. The study also revealed that there was monthly speed of adjustment of the variables towards their long-run equilibrium path to about 27 percent. The key discovery emanated from this study indicated that Consumer Price Index (CPI), Real Exchange Rate (RER), Money Supply (M2) and Interest Rate (INT) were significant monetary policy instruments that propelled economic growth in Nigeria during the period under review. Consequently, the study concluded by recommending Nominal GDP targeting as the framework to be adopted by the monetary authority in Nigeria in their monetary policy making process especially in the face of the new economic paradigm which is expected to be more plausible in improving and sustaining the stated Nigerian macroeconomic objectives. Contribution/ Originality: This study differs from others in examining the subject matter with high frequency data as against traditional annual data which has proved to be more efficient and captures more the effect of time, and the very first with such logical conclusion and recommendation for policy makers.

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Section: Literature Reviewmentioning

confidence: 99%

Efficacy of Monetary Policy Instruments on Economic Growth: Evidence from Nigeria

Tule¹,

Ogundele²,

Apinran³

2018

Asian Economic and Financial Review

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“…Ezeaku, Ibe and Ugwuanyi [12] assessed the industry effects of monetary policy transmission channels in Nigeria within the period 1981-2014. Techniques of analysis employed in the study are the Johansen cointegration and the error correction model (ECM).…”

Section: Empirical Reviewmentioning

confidence: 99%

Government Expenditure and its Effect on the Industrial Sector in Nigeria

Ozuzu

Isukul

2021

AJEBA

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This study examined the effect of government expenditure on the growth of the industrial sector in Nigeria. A regression analysis was applied in the analysis of the data. The study found that government capital expenditure has positive and significant effect on the industrial sector; tax has positive and significant effect on the industrial sector; monetary policy rate has positive and significant effect on the growth of the industrial sector, while real interest rate has a negative and no significant effect on the growth of the industrial sector. From the findings, we conclude that government policy has significant effect on the growth of the Nigerian industrial sector. It recommends that government fiscal policies such as public expending should be directed toward improving the quality of infrastructures in the country, especially the power sector, so that the cost of production can reduce. Government should examine should create an enabling environment with the right infrastructure, improve the security situation and reduce the epileptic power supply related issues. Also, government should examine its monetary policy variables such as interest rate and monetary policy rate. Furthermore, to promote growth, government should develop the industrial sectors of the economy through its capital expenditure.

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“…To estimate the macroeconomic policy model for Industrial Sector Growth, the ARDL model is being broadly used in monetary policy channels to find the short run and long run relationships of variables. Here, we have used five variables similar to the model used by Waliullah et al (2010), Dingela and Khobai (2017) and Ezeaku et al (2018). The simple linear regression equations for industrial sector as follows:…”

Section: Theoretical Modelmentioning

confidence: 99%

Monetary Policy Channels and Industrial Production in Pakistan: Evidences based on ARDL Approach

Mahmood

Shahab

Rabbani

2020

JAFEE

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Monetary policy is a significant component of economic management, with which we can control higher inflation, boost the economic growth and stabilize the other macroeconomic activities. This study investigates the channels of monetary policy affecting the industrial production using monthly data of Pakistan. In this regard, we have applied Bound test for co-integration to investigate the dynamic behaviour of the variables. Our results indicate that the consumer prices, money supply and money market rates are negatively effective for industrial production in the short-run. On the other hand, exchange rate has positive effect in short-run. The results also indicate that there is statistically significant and positive relationship between industrial output and money supply in the long-run, too. The adjustment mechanism suggests stability in the system and is statistically significant. Our results imply that the authorities should use expansionary monetary stance through money supply channel to boost the industrial sector.

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Monetary Policy Transmission and Industrial Sector Growth: Empirical Evidence From Nigeria

Cited by 20 publications

References 23 publications

Efficacy of Monetary Policy Instruments on Economic Growth: Evidence from Nigeria

Efficacy of Monetary Policy Instruments on Economic Growth: Evidence from Nigeria

Government Expenditure and its Effect on the Industrial Sector in Nigeria

Monetary Policy Channels and Industrial Production in Pakistan: Evidences based on ARDL Approach

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