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Constructing Divisia Monetary Aggregates for Nigeria
No full textThis study computes Divisia monetary aggregates DM1, DM2, and DM3 for Nigeria using the Tornqvist-Theil quantity index for the period 2007M12 to 2020M12 and evaluates the performance of the higher-order aggregate (DM3) with a corresponding higher aggregate of the simple sum broad money supply (M3). Applying the indicators to money demand function the results showed that DM3 performed better than the matching simple sum measure M3 due to its faster convergence rate. This is because the Divisia aggregates contain additional information in the form of user-costs and spending shares that are not considered in the compilation of the traditional measure, information that may be important for the proper execution of monetary policy. It is therefore, recommended that the Divisia broad money index be used as complement to the simple sum broad money supply for policy decisions
Size and Determinants of the Shadow Economy in Nigeria: Evidence from a Monetary Approach
No full textThiis study investigates the size and determinants of the shadow economy in Nigeria. It adopts an aggregation approach within the monetary framework and utilises the ARDL estimation technique to analyse quarterly data from 2010 Q1 to 2019 Q4. On average, the results suggest that the quarterly size of the shadow economy is about 55 per cent of the country’s GDP. The findings show that government size reduces the size of the shadow economy in the short run but increases it in the long run. The study also finds that interest rate, which is the opportunity cost of holding cash, and development of digital payment system (financial innovation) disincentivise informality. The policy implication is that the continuous development of effective digital payment products and their use could potentially reduce the size of the shadow economy in Nigeria
Pass-Through Effects of Standing Facilities on Bank Interest Rates in Nigeria
No full textThe paper investigates the pattern of pass-through effects of standing facilities rates on commercial bank retail interest rates in Nigeria. Monthly data spanning 2007:06 to 2019:12 and the Gregory-Hansen cointegration method that accounts for structural breaks are used in the empirical analysis. The adjustment parameters for the standing deposit and lending facilities are found to be significant, but with a low speed of adjustment. This provides some evidence on the nature of the interest rate channel of monetary policy transmission in the country. Furthermore, the study could not confirm asymmetry in the adjustment of retail rates to their long-run equilibria. Lastly, we find that when the cost of funds rises, following a hike of the upper bound of the policy rate corridor by the CBN, banks tend to cut costs by reducing interest expense rather than raising deposit interest rates to aggressively pursue deposit mobilisation
Rural Infrastructure and the Challenge of Food Security in Nigeria
No full textRural infrastructure, therefore, implies “the basic physical and organisational structures and facilities. In same vein, rural infrastructure are those forms of physical, social, human and institutional capital, which enhances rural dwellers better performance in the aspect of production, processing and distribution activities, as well as improving their overall quality of life
Monetary Policy Transmission and Bank Interest Rates in Nigeria
No full textThe paper examines the adjustment of retail and money market interest rates to changes in discount corridor of the monetary policy in Nigeria. A vector error correction model was adopted for this study, using monthly data from 2007:06 to 2019:12. We further accounted for structural breaks in the dataset to improve its policy reliability. The adjustment parameters were found to be significant but with slow speed of adjustment. This finding provides evidence of the weakness of the discount corridor in monetary policy transmission in Nigeria. Furthermore, the results showed no asymmetric adjustment of retail rates to long run equilibria. Lastly, the study found that the deposit rates respond inversely to changes in the standing lending facility. The results imply that the transmission of policy signals through the standing facility rates is not strong, and that raising the standing lending facility will not induce a rise in banks’ deposit rates
Understanding balance of payments and its link with monetary policy in Nigeria
No full textDevelopments in the balance of payments of any country is generally of interest to national policymakers, international investors, financial and economic analysts as well as international financial institutions. In recent times, Nigeria recorded persistent current account as well as overall BOP decits and these created discomfort among policy makers with regards to its sustainability and possible implications for the economy. This paper explores some of the major developments and trends in Nigeria\u27s BOP as well as their interrelationship with other macroeconomic accounts. It also provided clarity to the structure and components of Nigeria\u27s BOP statistics as compiled in line with the 6th edition of the balance of payments and international investments position manual of the IMF. This will deepen understanding of balance of payments among policy makers, analysts, researchers and compilers of macroeconomic statistics. It will also serve as a guide to policy makers in the design of appropriate monetary polic
Board of Directors\u27 Structure and Corporate Tax Aggresiveness of Listed Industrial Goods Companies in Nigeria
No full textTaxation plays a vital role in financing all government projects and activities, as such the studies of tax agressiveness can assist policy makers and tax authorities in addressing companies illegal tax schemes and taxing business more equitable in the sense that every entity pays their fair share of taxes. The study examines the effect of board structure on tax agressiveness of selected industrial goods companies listed in Nigeria Stock Exchange from 2016-2020. Data were obtained from annual report and account of the companies under investigation. Descriptive statistics, ordinary least square regression technique were used to estimate the model. Hausman\u27s specification test was also conducted to choose between fixed and random effect, the test favoured random effect over fixed effect, the test favoured random effect over fixed effect. The test favoured random effect over fixed effect. The result reveals that firm size (FSZ) and beverage (LEV) are negatively related to tax rate while board size (BZ) independent director (IND) was statistically significant. The study concluded that board size (BZ) has significant role to play in reducing tax aggressiveness of listed industrial goods in Nigeria and as such the study recommends that regulatory bodies should enforce strict compliance to the provisions of the codes of best practices by Nigerian companies
CBN Interventions and Food Security: Rationale, Experience and Challenges
No full textPrior to the outbreak of the Coronavirus (COVID-19) pandemic, conflicts, deteriorating socio-economic conditions, natural hazards, changing climatic conditions, prevalence of pest and diseases, etc., had led to reduced incomes, disrupted supply chains, and resulted in severe chronic and acute hunger across several countries, worldwide. These conditions were exacerbated by COVID-19 impacts, leading to severe and widespread increases in global food insecurity affecting vulnerable households in almost every country. These impacts expected to continue through 2021 and beyond as the Delta variant continues its spread (World Bank, 2021). Thus, the effects of the Pandemic on national food security systems becomes critical issue for policy analysis and intervention
Averting the Looming Food Crisis: A Clarion Call to Immediate and Near-term Policy Action
No full textDiscussions on food security have gained traction in the recent past, especially in Africa and other developing economies. Several horrifying images of famished families, particularly around “The Horn of Africa” including Somalia, Ethiopia, and some parts of Kenya, projected globally in both the print and electronic media vividly illustrate the perils of food crises. In Nigeria, food constitute a substantial share of family budgets, particularly for low-income households. When prices of essential foods items increase poorer people suffer the adverse impacts more disproportionately. While clothing and shelter are basic necessities of life, food remains the most vital, given its centrality to human existence. It is a known fact that the quest for food security has shaped human history, provoking wars, driving migration and underpinning the growth of nations. Consequently, to prevent food shortages and surmount deprivation, various international organisations and individual countries have embarked on aggressive crusades that will reduce the likelihood of crisis, remedy unsavoury situations and make food affordable to all
Uber Strategies and Competitiveness of Taxi Business in Areas of Operations in Nigeria
No full textThis study examined Uber\u27s strategies and competitiveness of taxi business in its areas of operation in Nigeria and how these strategies are disrupting taxi business in Lagos and Abuja metropolises. Two objectives were explored and the hypotheses were structured in line with set objectives. The study adopted the survey research design. Data were collected using primary and secondary sources The primary data were obtained from 191 respondents using a structured questionnaire designed in five points Likert scale. The respondents comprised a selected number of taxi independent operators and Uber mobile App users in Lagos and Abuja metropolises while the secondary data were obtained from Uber Nigeria Database. The tests of hypotheses were carried out using simple regression analysis with the aid of the Statistical Package for the Social Sciences (SPSS) version 21. The findings of the research showed that Uber\u27s strategies have a significant influence on the disruption of the taxi business in its areas of operations in Nigeria. It also discovered that Uber\u27s technology innovation strategy has a significant influence on the competitive advantage in its areas of operations in Nigeria. Therefore the study concludes that Uber has developed business strategies, and that these strategies to a large extent have enabled Uber Nigeria to gain large market share, competitiveness over its rivalries, customer loyalty, high profit, and projected longer-term sustainability. The study recommends that the firm should expand to other geographical areas in Lagos in particular, and other states in Nigeria generally, in other to gain more market share and profit. The firm should focus more on research and development to improve on the App-based innovation, and also using the technology innovation strategy, the firm should endeavour to target the segment of the market that has been neglected by the existing taxi operator