THE IMPACT OF MONETARY POLICY ON PRIVATE CAPITAL FORMATION IN NIGERIA- AUTOREGRESSIVE DISTRIBUTED LAG APPROACH
Autor (i): Olufunke Iyabo Ajoje (PhD)1 Yetunde Moriliat Aliu2 Olufemi Samuel Adegboyo3
Cuvinte cheie: Monetary policy, private capital formation, ARDL
Abstract:
The study examines the impact of Monetary Policy on Private Capital Formation in Nigeria over the period 1980 to 2020. The study adopts Keynes theory of capital formation as its theoretical framework. The stationarity tests result shows that there is mixed level of stationarity among the variables. Consequently, the study employs ARDL as its estimation technique. The study reveals that Monetary Policy has a positive impact on Private Capital Formation in Nigeria. Based on the findings, the study recommends that government should implement appropriate Monetary Policy which will continue to have more positive impact on Private Capital Formation. Secondly, the government should maintain a reasonable percentage of Monetary Policy rate (MPR) and as well as Real Gross Domestic Product (RGDP) and Reasonable Exchange Rate (EXCHR) to improve the level of Private Capital Formation in Nigeria. Lastly, the government should embark on policies that will curb inflation or help to reduce the rate of inflation in order to increase the level of Private Capital Formation.
The study examines the impact of Monetary Policy on Private Capital Formation in Nigeria over the period 1980 to 2020. The study adopts Keynes theory of capital formation as its theoretical framework. The stationarity tests result shows that there is mixed level of stationarity among the variables. Consequently, the study employs ARDL as its estimation technique. The study reveals that Monetary Policy has a positive impact on Private Capital Formation in Nigeria. Based on the findings, the study recommends that government should implement appropriate Monetary Policy which will continue to have more positive impact on Private Capital Formation. Secondly, the government should maintain a reasonable percentage of Monetary Policy rate (MPR) and as well as Real Gross Domestic Product (RGDP) and Reasonable Exchange Rate (EXCHR) to improve the level of Private Capital Formation in Nigeria. Lastly, the government should embark on policies that will curb inflation or help to reduce the rate of inflation in order to increase the level of Private Capital Formation.
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