This study empirically examine the impact of inflation on private consumption expenditure and economic growth in Nigeria using an annual time series data spanning from 1981-2012. In this study, modern time series econometric methodology such as Unit Root Testing, Johansson Co-integration test, Vector error co-integration granger causality test(VEC) and Vector Error Correction Model (VECM) where employed to model both the long run and short run relationships between inflation, economic growth, interest rate as (explanatory variables) and private consumption expenditure as (dependent variable). Augmented Dickey- Fuller (ADF) and Phillips–Perron (PP) test were conducted and the results show that all the data are not stationary at a level but after the first difference they become stationary. The Johansson co-integration test indicates that there exists a long run relationship between the variables for the period of study. However, the VEC Granger Causality result shows that inflation is positively granger causes private consumption expenditure for the period of study and there happens to be no causality flowing from inflation to economic growth, neither is there causality from economic growth to inflation in the short run. However, the long-run model result shows a negative impact of inflation on economic growth for the study period. It implies that I per cent increase in inflation will result in 0.69 decreases in economic performance (RGDP). It could therefore be recommended that Government together with the central Bank of Nigeria should develop and pursue prudent monetary and fiscal policies that would aim at reducing and stabilizing both the micro and macroeconomic indicators especially inflation targeting, so as to boast the growth of the economy.
THE IMPACT OF INFLATION ON PRIVATE CONSUMPTION EXPENDITURE AND ECONOMIC GROWTH IN NIGERIA
THE IMPACT OF INFLATION ON PRIVATE CONSUMPTION EXPENDITURE AND ECONOMIC GROWTH IN NIGERIA
Chapters 1–5 | ₦5,000
Download Complete Project NowABSTRACT
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
The management of the economy is a major concern of governments all over the world. Governments of countries feel compelled to ensure, through appropriate policies that their economies are managed to achieve desirable macroeconomic objectives. These objectives include: price stability; economic growth; full employment; and balance of payments equilibrium. The achievement of stable prices and attainment of sustainable economic growth had been the central objectives of macroeconomic policies for most countries in the world today. This is so because the achievement of other objectives like full employment and balance of payment equilibrium are also determined by the achievement of price stability and economic growth. (Ohale & Onyema, 2002)
Economic growth is dependent upon the productive effort of a society and investment of resources. An increase in production and investment will lead to economic growth. A country’s rate of growth can be affected by inflation through its effect on investment. An increase in inflation rate reduces the return on investment, both on physical and human capital. Lower returns mean less accumulation and innovation and hence a lower rate of growth. Growth in output of goods and services is a good way of bringing material benefits to the citizens. This is through fostering those developments such as increased investment, technical progress, increase in demand, amongst others, which are conducive to the growth of the economy. Investment is required to maintain output per head in the face of an increase in the size of labour force. Moreover, increase in consumption expenditure makes producers to respond by increasing their capacity and by so doing, promote economic growth. Nevertheless, as the level of economic activities increase, an economy experiences growth (Ohale & Onyema, 2002; and Apere, 2006).
Private consumption expenditure constitutes the largest component of total consumption expenditure in Nigeria and accounts for more than 65% of the Gross Domestic Product, GDP ( National Bureau of Statistics, 2010). Thus, private consumption expenditure is a core component of aggregate demand.
This Project is for You If:
- You are writing your final year project for the first time and don't want to make costly mistakes
- This is your exact topic, or very close to what your supervisor gave you
- Your supervisor has rejected one or more chapters and you don't know what to fix
- You are stuck on Chapter 3 or data analysis and nothing is making sense
- Your deadline is close and you are still far behind
- You can't find enough materials anywhere for your topic
- My project supervisor is very strict and I don't want to have any problem with my project work — I need a well structured and referenced project
- I saw my school project requirement and I am confused on where or what to do
- Everyone in my class has submitted their project and I haven't even started yet
- My supervisor rejected my research methodology and I don't know what to do
- I thought my topic was simple and easy but on Chapter 2 I cannot find any material and my work is due for submission
- I have the content somehow but my references and bibliography are all over the place and I don't know how to arrange them properly
- I am combining school with work and I genuinely do not have the time to write everything from scratch — I just need something to work with
- My supervisor changed the topic I wanted and approved another one — I am confused on where to start from
- I am scared of submitting something that will be flagged for plagiarism — I need something original that I can use as a proper guide
- I have been browsing the internet for days looking for materials on this topic and I cannot find anything useful anywhere
- This is not my first time doing this project — I have carried it over before and I cannot afford to do it again
- I have written some chapters already but I am stuck midway and need to see how others handled the same topic
Here's everything you get with the complete project package:
✔Chapters 1–5 (Word & PDF)
✔Abstract & Table of Contents
✔References, Citation & Bibliography
✔Fully Editable Microsoft Word Format
✔Original, Plagiarism-Free Content
✔Instant Email Delivery
Complete package —₦10,000₦5,000
Price may return to ₦10,000 at any time.
See Our Conversations With Students on WhatsApp
Students sharing their experience after using our service
Urgent delivery confirmed
Screenshot unavailable
Payment received and project delivered
Screenshot unavailable
Quality work and a repeat order
Screenshot unavailable
Returning customer appreciation
Screenshot unavailable
Customer appreciation
Screenshot unavailable
What Other Students Are Saying
↩ View More ReviewsCan't find what you're looking for?
Search thousands of project topics across every department.
Frequently Asked Questions
Yes. All project materials on iProject are original, well-researched, and crafted to be plagiarism-free. They are intended as academic guides and reference materials.
You will receive the complete project in both Microsoft Word (.docx) and PDF formats, making it easy to edit and submit.
Delivery is instant. Once payment is confirmed, the material is sent directly to your email address. You can also download it immediately from the checkout page.
Absolutely. The Word format is fully editable, allowing you to modify the content, swap out case studies, and adapt the material to your specific research context.