Does Volatility in Crude Oil Price Precipitate Macroeconomic Performance in Nigeria?

Authors

  • Joseph Ayoola Omojolaibi

Abstract

This study examines the effects of crude oil price changes on economic activity in an oil dependent economy-Nigeria. A small open economy structural vector autoregressive (SVAR) technique is employed to study the macroeconomic dynamics of domestic price level, economic output, money supply and oil price in Nigeria. The sample covers the data from 1985:q1 to 2010:q4. The Impulse Response Functions (IRFs) and the Forecast Error Variance Decompositions (FEVDs) results suggest that domestic policies, instead of oil-boom should be blamed for inflation. Also, oil price variations are driven mostly by oil shocks, however, domestic shocks are responsible for a reasonable portion of oil price variations.    Keywords: Oil price; Monetary policy; Fiscal policy; Inflation; Nigeria JEL Classifications: E31; E52; E62

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Author Biography

Joseph Ayoola Omojolaibi

ECONOMICS

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Published

2013-03-14

How to Cite

Omojolaibi, J. A. (2013). Does Volatility in Crude Oil Price Precipitate Macroeconomic Performance in Nigeria?. International Journal of Energy Economics and Policy, 3(2), 143–152. Retrieved from https://econjournals.com./index.php/ijeep/article/view/389

Issue

Vol. 3 No. 2 (2013)

Section

Articles

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