Nigerian Journal of Contemporary Public Policy Issues
This journal is a bi-annual peer-reviewed dedicated publication of contemporary economic and public policy issues. The two-fold purpose of the journal is to provide a global forum for presenting authoritative references, academically rigorous, theoretical and applied researches, as well as case studies. it captures and publishes the latest thinking on a variety of topics related to contemporary economics and public policy.
Department of Economics, A. B. U., Zaria.
THE DYNAMICS OF INFLATION IN NIGERIA AND REDISTRIBUTION AS COUNTER INFLATION TACTIC IN REDUCING THE INEQUALITY GAP: IS AFRICAN SOCIALISM THE WAY FORWARD?
The paper is an exploratory study that seeks to answer the question is redistribution the way forward in curbing the current inflation and inequality problem in Nigerian as well as in similar African countries? The aim is to serve the purpose of using Nigeria as the litmus test for such tactics and to see how it has been done and can be applied in recent economic circumstances of inflation and inequality. The study covers the period between December 2019 with the start of the Covid-19 pandemic, until December 2021. The study finds that Nigeria has had policies before such as conditional cash transfer, the teach Nigeria scheme, the youth employment agency, the homegrown school feeding program, and the free scheme for science, technology, engineering and math (Stem) etc., which have served as redistribution in Nigeria, which may have helped in curbing inequality (of income and otherwise) at least in the short run. And thereby, being a backdoor towards African socialism. The paper concludes due to the evidences prescribed in terms of the policies of the Nigerian case, that redistribution is a way out of the inflation problem. It finally recommends that taxing the super-rich is a way forward, cash injections and public-private partnerships should be encouraged and state sponsored welfare should be highly encouraged amongst others as further ways of bringing back the old African ways of Socialism, which is distinctively original to the Africans as people, and as a race.
Copyright (c) 2021 Nigerian Journal of Contemporary Public Policy Issues
MACROECONOMIC DETERMINANTS OF INFLATION IN NIGERIA
Nigeria is rapidly facing perennial shocks resulting from price fluctuation leading particularly the monetary authority to implement several measures aimed at overcoming the problematic inflation. However, the price changes persist and concerns are mounting on what determines inflation in Nigeria. This study investigates empirically the macroeconomic determinants of inflation in Nigeria. The study used annual time series data covering from 1984 to 2019 which was analysed within the framework of Autoregressive Distributed Lag. The finding using the bound test shows evidence of cointegration among the exchange rate, interest rate, money supply, inflation and trade openness in Nigeria. Interestingly, while the finding further established that money supply and trade openness have a significant positive impact on inflation both in short run and long run, exchange rate has a significant positive effect on inflation in the short run but negatively in the long run. However, interest rate is impacting negatively on inflation in both short run and long run. Thus, Central Bank through monetary policy has a dedicated role to play in finding a harmonious threshold level of money supply, interest rate and exchange rate consistent with the desired inflation level that will spur the performance of the Nigerian economy.
EFFECTIVENESS OF MONETARY POLICY AND INFLATION DYNAMICS IN NIGERIA
This paper examines the monetary policy effectiveness and inflation dynamics in Nigeria using the Autoregressive Distributed Lagged (ARDL) Cointegration Bound test. Quarterly time series data from 2006:1 - 2020:4 for inflation, money supply, monetary policy rate, liquidity ratio, and cash reserve requirement were used in the empirical analysis. The result of the bound test suggests that there exists a long-run cointegration relationship between inflation and the monetary policy variables included in the model. The result of the ECT coefficient is negative and statistically significant at the 5% significance level thereby supporting the result of the Bound test on the existence of a long-run relationship between the variables. The ARDL short-run estimates show that all the selected monetary policy instruments have a predictable influence on the inflation rate with varying lags. While the long-run estimates indicated that only the monetary policy rate and cash reserve ratio significantly influence the inflation rate. The result of the granger causality test shows a bidirectional causality between broad money supply and inflation rate and a unidirectional causality running from inflation rate to liquidity ratio. The study concluded that monetary policy instruments deployed by the CBN seem to have the anticipated traction on the inflation rate. Hence, it is pertinent for the CBN to continue the utilization of all the policy measures adopted to keep inflation within acceptable thresholds, with emphasis on the monetary policy rate and cash reserve ratio for long-run objectives
ROLE OF AGE GRADE SYSTEM IN CRIME CONTROL AMONG TIV PEOPLE IN NORTH CENTRAL NIGERIA
Every age grade system has its means of controlling the conduct of its citizens to reach its desired goals. The importance of age grade system in this regard cannot be overemphasized. Thus, the age grade provides, among other things, the penal techniques by which those who are found guilty of acts prohibited by society are punished. The age grade system among Tiv people in north central Nigeria has in its body of customary laws and a rich penal system. Though largely unwritten, the deterrence theory of punishment is adopted. The reason for this theory is that its best captured the operation of age grade among Tiv people in north central Nigeria. This paper discovered that factors such as migration and apathy have been major challenges to age grade operation. This paper recommends that security agents should collaborate with age grade systems in the rural areas to tackle security situations envisaged in Nigeria today. The national assembly should make laws that will give legal backing to age grade operation to tackle the current security challenges in the country.
INSTITUTIONAL QUALITY AND EXPORT DIVERSIFICATION IN NIGERIA: AN EMPIRICAL INVESTIGATION
This study examined the relationship between quality of institutions and Nigeria’s economic diversification and how institutional quality impacts the export diversification in Nigeria, using time series data that are sourced from Central Bank of Nigeria (CBN) statistical bulletin (2020), National Bureau of Statistics (NBS,2020), World Development Indicator. The institutional variables used are; Revenue Sources Volatility (RSV) and Quality of Service Delivery (QSD) and Non-Oil Export (NOE) growth rate as a proxy for export diversification. The study adopted ARDL model as techniques of analysis given that the variables are mixture of I(0) and I(1). The finding of the study indicate that institutional variables are positively related to export diversification and statistically significant at 1% in short run and at 10% in long run, which implies that quality of institution matter for economic diversification in Nigeria. Specifically, in long run, a 1% change in quality of services delivery will lead to 0.23% increase in export diversification, and in the short the speed of adjustment of all the variables to the longrun equilibrium was found to be 89% and is significant at 1%. The study therefore recommended that institutions should be empowered and strengthening so that government economic diversification agenda can be achieved in Nigeria.
MODELLING MACROECONOMIC DYNAMICS AND MONETARY POLICY TRILEMMA IN NIGERIA: A BAYESIAN VAR APPROACH
In the wake of contagious shocks affecting open economies, the conduct of monetary policy in an open-economy is increasingly becoming challenging for policymakers. Hence given the macroeconomic dynamism originating from either economic size, inflation, trade openness, or financial development Thus, this paper seeks to find the impact of macroeconomic dynamic on monetary policy trilemma in Nigeria. To this end, the Mudell-Fleming framework was used and the Bayesian VAR was applied as the estimation technique. The paper found that a positive domestic output shock that is associated with a rise in net export will indirectly lead to exchange rate stability in both the short and long term. An attempt to accommodate this shock with the view of increasing the level of export growth was found to be detrimental to Monetary Policy Independence (MPI). More so, under the rising influence of domestic output growth, the paper finds that trade openness is beneficial to exchange rate stability in Nigeria for the period under review. Furthermore, owing to a temporal capital inflow effect relative to outflow, financial development was found to have a net-negative effect triggering exchange rate instability. Effectively inflationary shock was found to have an inconsequential effect on MPI. The paper also found the difficulty with which policymakers implement monetary policy in an open economy (open capital account) without giving up some level of autonomy in stabilizing domestic output. The paper concludes that the trilemma- solution that is in tune with stable inflation and output is a middle ground that allows for some degree of weight shared between MPI and CAO while placing full weight on ERS.
LABOUR SUPPLY EFFECTS OF SOCIAL PROTECTION IN SUB- SAHARAN AFRICA
Many countries in Sub-Saharan Africa (SSA) are building up more targeted social protection systems to cover the poor and vulnerable segments of the population. However, their impacts on the labour market have been questioned on several fronts, and one of the main debates is concerned with their possible distortionary effects on labour supply. Thus, this paper explores the labour supply effects of social protection based on a unique cross-country dynamic panel data for 17 Sub-Saharan African countries. The paper estimates the social protection elasticity of labour supply using the Generalized Method of Moments (GMM) econometric technique. The panel data utilized is characterized largely by the existence of fixed effects, indicating the persistence of substantial heterogeneity across countries. Estimates from the system GMM model suggest essentially that at any given time, a 1 percent increase in social protection investment would lead to a 2.9 percentage increase in aggregate labour supply. This suggests that public investments on social protection induce a substitution effect in favour of greater labour supply. The dominance of the substitution effects over possible income effects is also robust to heteroscedasticity and autocorrelation. The overall implication of this result is that expanding public investments on social protection at a much higher scale could induce greater labour force participation and lower voluntary unemployment as a result. This can lead to higher incomes, poverty reduction, and lower levels of inequality over time. The results also imply the need to continue to scale up social protection programmes because of their positive labour market and employment benefits.