Monetary Policy and International Trade: A Case Study of the Nigerian Economy

Monetary Policy and International Trade: A Case Study of the Nigerian Economy

Registration ID: IJNRD_208381

Published ID: IJNRD2402188

DOI: Click Here to Get

Yakub Kareem

The Nigerian economic system attracts international investment, and it is important to understand how the country’s policy relates to external capital inflows. In this case, the effectiveness of the monetary policy and international trade on the Nigerian economy is still a debatable issue, particularly related to the efficiency of the dependency mechanism. Accordingly, there is a need to check how monetary policy instruments improve the level of international trade for economic growth. This study examined the role of monetary policy and international trade on the Nigerian economy (1982-2021). The study used secondary time series data from the Central Bank of Nigeria, Statistical Bulletin, and the World Bank Development Indicators (2022). An auto-regressive distributed lag (ARDL) technique was employed in this study. Pre-estimation tests showed Interest rates (INTR), Gross capital formation (GCF), and Trade openness (OPNSS), were integrated of order zero, I(0). While GDP per capita (GDPk), Money supply (MS), and Exchange rates (EXR) were integrated of order one, I (1). The Error Correction Term (ECT) coefficient showed a 29 percent speed of adjustment (moderate), which implies a correctness level towards equilibrium from monetary policy and international trade activities of Nigeria’s economy. Findings reveal that MS, INTR, and EXR, negatively but significantly affects the GDP per capita in the short run, while GCF and OPNSS was found to affect GDPk positively. Categorically, international trade has positively contributed to the economy. However, the monetary authority needs an efficient policy to stimulate money flow in the economy. Based on this result, the study recommends that government should put measures to place to stimulate the flow of money circulating in the economy in the short-term period. Nigeria can increase its GDP per capita performance by relying on its trade liberalization policy in all its manifestations and its global trade policy.

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"Monetary Policy and International Trade: A Case Study of the Nigerian Economy", IJNRD - INTERNATIONAL JOURNAL OF NOVEL RESEARCH AND DEVELOPMENT (www.IJNRD.org), ISSN:2456-4184, Vol.9, Issue 2, page no.b746-b764, February-2024, Available :https://ijnrd.org/papers/IJNRD2402188.pdf

Volume 9 Issue 2, February-2024

Pages : b746-b764

Paper Reg. ID: IJNRD_208381

Published Paper Id: IJNRD2402188

Downloads: 000121283

Research Area: Social Science and Humanities 

Country: Gwagwalada, FCT, Abuja, Nigeria

Published Paper PDF: https://ijnrd.org/papers/IJNRD2402188.pdf

Published Paper URL: https://ijnrd.org/viewpaperforall?paper=IJNRD2402188

Journal Name: INTERNATIONAL JOURNAL OF NOVEL RESEARCH AND DEVELOPMENT(IJNRD)

ISSN: 2456-4184 | IMPACT FACTOR: 8.76 Calculated By Google Scholar | ESTD YEAR: 2016

An International Scholarly Open Access Journal, Peer-Reviewed, Refereed Journal Impact Factor 8.76 Calculate by Google Scholar and Semantic Scholar | AI-Powered Research Tool, Multidisciplinary, Monthly, Multilanguage Journal Indexing in All Major Database & Metadata, Citation Generator

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This work is licensed under a Creative Commons Attribution 4.0 International License and The Open Definition

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