Interest Rate Pass-through from Wholesale Rate to Deposit Money Banks Retail Rates in Nigeria: An ARDL Approach

The paper investigates interest rate pass-through from wholesale rate to seven types of Deposit Money Banks (DMBs) retail rates. The justification for the study is to discover what we have learnt about the changes in the interest rate pass-through from the whole sale rate to intermediate rates after the capital reform of 2005. Evidence from the study will also aid monetary policy decisions for macro-economic management in Nigeria. We use monthly data for the period 2006M01-2015M01 based on ARDL approach. Our findings reveal that Interest Rate Pass-through (IRPT) affects DMBs products differently. In the case of deposit rates, pass-through is near complete in the short run for all products except for 12month deposit rate. In case of lending rates, the prime lending rate pass-through was complete while the maximum lending rate was incomplete. The bounds test suggest the existence of a long-run relationship between the variables such that the speed of adjustment takes an average of 16 months for deposit rates and 7months for prime lending rate before they return to their equilibrium positions. Based on the findings that pass-through of wholesale rate to DMBs retail rates is sufficiently high during the month, we conclude that monetary policy is reasonably effective in determining changes in the intermediate target in the short-run in Nigeria Keywords: pass-through, wholesale rate, deposit rate, lending rate, deposit money bank

Government Policy, Foreign Direct Investment and Unemployment in Emerging Economies

The broad objective of this study is to determine how government policy influences FDI as well as how FDI affects the level of unemployment as a proportion of labour force in emerging economies. The techniques of analysis are a descriptive statistic and panel regression based on Ordinary Least Squares Method. Evidence from the descriptive analysis affirms that the variables of the study for each country exhibit contradictory behaviour in 1991-2016. In the same period, the foremost beneficiaries of the net inflow FDI are not experiencing the lowest unemployment rate. Panel regression results (2000-2015) suggest that net inflow of FDI has a negative influence on unemployment while government policy has no significant effect on the net inflow of FDI. The study concludes that a continuous inflow of net foreign investment is a good source of creating jobs in emerging economies. Due to the lack of influence of government policy on the net inflow of FDI, the study recommends that emerging economies should revise the regulation on the freedom to trade internationally so as to enhance the continuous flow of foreign direct investment

Dynamics of Inventory Cost Optimization – A Review of Theory and Evidence

The inventory control models as an estimation tool for optimizing inventory cost and management of inventory is discussed in this paper. Various methods of estimating the Economic Order Quantity (EOQ), Safety Stocks under deterministic and stochastic situations are reviewed. Traditional methods of managing inventory such as accounting ratios analysis, two bin systems, perpetual inventory system and some others form part of this paper. Ratings of inventory or its classification in order of priority by unit and consumption value are also reviewed in the paper. Empirical evidence reviewed in this work tends to support the opinion that modern method of inventory control is far more effective and efficient than the traditional methods of control. Keywords: Inventory Control Models, Inventory Ratios, Economic Order Quantity

Uncertainty of Output Gap and Monetary Policy-Making in Nigeria

This paper investigates the effect of output gap uncertainty on monetary policy rate in Nigeria-1991Q1-2014Q4. A major challenge of monetary policy is the attainment of sustainable output level but in setting the optimal monetary policy rate information about output gap and how uncertainty of the gap affects the path of the monetary policy rate is crucial for policy use. Empirical evidence on this phenomenon in Nigeria has been concerned with how monetary policy affects output while evidence on the response of monetary policy to uncertainty of real output is not indepth. Analythical approach in this paper adopts the Generalised Method of Moments econometric technique