Growth and Oil Price Fluctuation in Nigeria: A Variance Decomposition Evidence
DOI:
https://doi.org/10.23918/ijsses.v4i1p1Keywords:
Growth Rate, Shocks, Oil PriceAbstract
This study examines the impact of oil price shocks on economic growth rate in Nigeria using the impulse response functions and forecast error variance decomposition on quarterly data from 2000 to 2016. This study finds that fluctuations in oil prices cause swings in GDP growth rate in Nigeria. The fluctuation in oil prices also depreciates Naira exchange rate. The country should branch out its revenue sources to shield the dangle effect of the fluctuation in prices of oil.
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