EFFECTIVENESS OF STABILIZATION POLICIES IN NIGERIA UNDER THE PHILLIPS CURVE FRAMEWORK
Abstract
Stabilization policies have been viewed globally as the prerogative of the Central Banks in terms of monetary policies, but will need to be supported by well formulated fiscal policies. In the case of Nigeria, and drawing from the assumptions of the Phillips Curve, we have assessed in this study the effectiveness of the stabilization policies in Nigeria using annualized data for the period 1986-2014. The technique of analysis applied in estimating the multiple regression model is the Ordinary Least squares while other relevant test like the Phillips-Perron unit root test, descriptive statistics and the histogram-normality test were also employed. The results revealed that inflation rate and interest rate has negative influence on unemployment rate in Nigeria but while the former was significant the late was not significant. Money supply growth on the other hand has positive and significant effect on unemployment rate in Nigeria. We therefore conclude that monetary policy targets are crucial in the stabilization of the Nigerian economy. We hence recommend that policy stance of the monetary authorities must be target towards a defined objective in order to achieve the desired result.
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DOI: http://dx.doi.org/10.46827/ejsss.v0i0.330
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