International Journal of Social Science & Economic Research
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Title:
EFFECT OF EXCHANGE RATE FLUCTUATION ON ECONOMIC GROWTH IN NIGERIA (1998-2018)

Authors:
Ighoroje Ese James, Edore Julius Ovuefeyem

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1 Ighoroje Ese James, 2Edore Julius Ovuefeyem
1,2. Department of Banking and Finance, School of Business Studies , Delta State Polytechnic, Ozoro

MLA 8
James, Ighoroje Ese, and Edore Julius Ovuefeyem. "EFFECT OF EXCHANGE RATE FLUCTUATION ON ECONOMIC GROWTH IN NIGERIA (1998-2018)." Int. j. of Social Science and Economic Research, vol. 4, no. 12, Dec. 2019, pp. 7216-7235, ijsser.org/more2019.php?id=551. Accessed Dec. 2019.
APA
James, I., & Ovuefeyem, E. (2019, December). EFFECT OF EXCHANGE RATE FLUCTUATION ON ECONOMIC GROWTH IN NIGERIA (1998-2018). Int. j. of Social Science and Economic Research, 4(12), 7216-7235. Retrieved from ijsser.org/more2019.php?id=551
Chicago
James, Ighoroje Ese, and Edore Julius Ovuefeyem. "EFFECT OF EXCHANGE RATE FLUCTUATION ON ECONOMIC GROWTH IN NIGERIA (1998-2018)." Int. j. of Social Science and Economic Research 4, no. 12 (December 2019), 7216-7235. Accessed December, 2019. ijsser.org/more2019.php?id=551.

References

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Abstract:
The study examines the effect of exchange rate fluctuation on economic growth in Nigeria for the period 1998 to 2018. The study period was chosen based on data availability. The study used secondary data collected from central bank of Nigeria Statistical Bulletin for various issues. Econometric evidence using Augmented Dickey-Fuller (ADF) unit root tests reveals that the stationarity of the various exchange rates and economic growth were all at first difference. Engel-Granger and Johanson cointegration tests reveal the existence of cointegrating effect thus signifying a long run equilibrium effect between the dependent and the independent variables. Ordinary Least squares (OLS) results and the Error correction model (ECM) show that Average Official exchange rate (AOER), Nominal effective exchange rate, (NEER), and Real effective exchange rate (REER) rate each has a positive but insignificant effect on economic growth of Nigeria both in the long run and in the short run. The findings also showed that contrary to the other variables, the Average Central exchange rate (ACER) has a negative although insignificant effect on economic growth in Nigeria. The study concludes that exchange rate depreciation is more to the advantage of Nigeria as depreciation within the period has enhanced economic growth although minimally. The study recommends diversification of production away from oil while aiming more at technological advancement and industrialization.