Environmental quality and economic growth in Nigeria: A fractional cointegration analysis

The paper investigates the relationship between environmental quality and economic growth in Nigeria using a fractional cointegration analysis over the period 1970-2011. It seeks to examine the effect of growth on environmental performance by controlling for the role of institutional quality, trade openness and population density. The paper found that early stages of development in Nigeria accentuate the level of environmental degradation. It also finds that weak institutions and unrestricted trade openness increase the extent of environmental degradation due to environmental dumping. Finally, the paper shows that a larger population density enhances the promptness of environmental abatement measures and consciousness for cleaner environment. The study, however, failed to attain a reasonable turning point and hence a non-existence of EKC in Nigeria. The paper recommends the need to restrict the importation of emission intensive products, check the activities of multinationals which invest in producing high CO2 emitting goods in LDCs and exports to home countries. Finally, there is need to strengthen institutional quality to ensure adoption of clean technologies as income rises

Public debt shocks and macroeconomic stabilization in Nigeria: A new Keynesian approach

The study examined the impact of public debt shocks on Nigeria’s macroeconomic stability. This study aimed to evaluate the role of increasing public debt on macroeconomic variables in Nigeria using a New Keynesian approach to evaluate the effect of both external and domestic debt on macroeconomic stability and the impact of debt service on revenue on Nigerian macroeconomic stability. The dynamic stochastic general equilibrium model was adopted as an analytical tool using the Bayesian approach in a Matlab R2021a in a Dynare 4.6.4 environment to determine the influence of public debt shock on macroeconomic stability in Nigeria. It was discovered that a positive relationship exists between output (economic growth) and foreign debt in Nigeria within the period under review. It was also found that debt service to revenue ratio, interest rate, and domestic debt have a negative relationship with output (economic growth). As a result, an increase in external debt will positively impact output (economic growth). In contrast, an increase in the debt service to revenue ratio, interest rate, and domestic debt will have a negative transmission effect on Nigeria’s macroeconomic stability. High debt service would impede growth by reducing public resources and productive investment that would otherwise be used to encourage growth. According to this result, external debt is the best option for capital projects rather than domestic debt, which is likely to affect the business environment negatively. This study is practically relevant to government, investors, scholars, and policymakers, especially those around fiscal policy, to guide them in advising the government on where to borrow for its capital projects when neede

Is Africa’s current growth reducing inequality? Evidence from some selected african countries

Is Africa’s current growth reducing inequality? What are the implications of growth on output performances in Africa? Does the effect of Africa’s growth on sectorial output have any implication for inequality in Africa? The study investigates the effect of shocks on a set of macroeconomic variables on inequality (measured by life expectancy) and the implication of this on sectors that are perceived to provide economic empowerment in form of employment for people living in the African countries in our sample. Studies already find that growth in many African countries has not been accompanied with significant improvement in employment. Therefore inequality is subject to a counter cyclical trend in production levels when export destination countries experience a recession. The study also provides insight on the effect of growth on sectorial output for three major sectors in the African economy with the intent of analyzing the impact of growth on sectorial development. The method used in this study is Panel Vector Autoregressive (PVAR) estimation and the obvious advantage of this method lies in the fact that it allows us to capture both static and dynamic interdependencies and to treat the links across units in an unrestricted fashion. Data is obtained from World Bank (WDI) Statistics for the period 1985 to 2012 (28 years) for 10 African Countries. Our main findings confirm strong negative relationship between GDP growth and life expectancy and also for GDP and the services and manufacturing sector considering the full sample