Department of Economics

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Promoting female economic inclusion for tax performance in Sub-Saharan Africa
(Economic Analysis and Policy Volume 69 (Published byElsevier), 2020) Asongu A.; Adegboye Alex; Nnanna Joseph
This study explores whether female economic inclusion enhances tax performance in a sample of 48 countries in Sub-Saharan Africa from 2000 to 2018. The study’s empirical evidence is based on the generalized method of moments in order to account for endogeneity concerns. Three tax performance measurements are used, notably, total taxes revenue excluding social contributions, reported tax revenue derived from natural resources sources, and total non-resource tax revenue. Three female inclusion indicators are used, namely, female employment in industry, female labour force participation, and female employment. The following empirical evidences are documented; (i) There is a negative net effect from the enhancement of female employment in the industry on the total tax revenue. (ii) There is a positive net effect of female employment in the industry on the non-resource taxes. An extended threshold analysis is performed to establish the critical masses that could further influence tax performance positively. The following thresholds are established. (i) a minimum of 15.35 “employment in industry, female (% of female employment)” for the total tax revenue and (ii) a maximum of 23.75 “employment in industry, female (% of female employment)” for the non-resource tax revenue. These critical masses are crucial for sustainable development because, below or beyond these thresholds, policymakers should complement the female economic inclusion with other economic measures designed to improve tax performance in Sub-Saharan Africa.
The mobile phone technology, gender inclusive education and public accountability in Sub-Saharan Africa
(Telecommunications Policy Volume 45, Issue 4,, 2021-05) Asongu A.; Adegboye Alex; Ejemeyovwi Jeremiah O.; Umukoro O. E.
This study assesses the relevance of mobile phone technology in complementing gender inclusive education (i.e. primary, secondary and tertiary) to promote public accountability (i.e. involving horizontal, vertical and diagonal accountability dynamics). The study utilizes the generalized method of moments (GMM) technique to establish the empirical evidence based on 48 Sub-Saharan African countries for the period 2005– 2018. The following findings are documented from the linkages between mobile phone technology, inclusive education and public accountability. First, the interactions between mobile phone technology and inclusive education promote public accountability. Second, with regard to net effects, while unexpected negative signs are established, the corresponding positive interactive effects indicate that enhancing the penetration of mobile phone technology beyond some critical thresholds ensures positive net effects. Hence, policy makers should ensure that mobile phone technology penetration exceeds the established thresholds in order for gender inclusive education to positively affect public accountability.
EFFCTS OF DIGITAL PAYMENT AND FINANCIAL INCLUSION ON ECONOMIC GROWTH IN SELECTED WEST AFRICAN COUNTRIES
(Covenant University Ota, 2025-04) ADEKOYA, Oluwasegun Ayomide; Covenant University Dissertation
This study examined the effect of digital payment and financial inclusion on economic growth in selected West African countries. The financial sector remains a key driver of economic growth globally, especially as countries employ more technology-driven systems; this shift has profound effects across all sectors, including the financial sector. Meanwhile, despite the ongoing policy efforts to promote digital transactions, West Africa still lags behind in financial inclusion as compared to the global standards. Hence, the study examined the interactive effect of digital payment and financial inclusion on economic growth in selected West African countries. This study employed the Pooled Ordinary Least Squares (POLS) estimation technique to analyse data for ten (10) West African countries from 2014 to 2022. The data was sourced from the World Bank’s World Development Indicators. The explanatory variables used in the model were; mobile transfer payment, mobile money, account ownership at a financial institution or with a mobile-moneyservice provider, labour force and gross fixed capital formation, the dependent variable was real gross domestic product. The findings of the study revealed that both digital payments and financial inclusion independently contribute positively and significantly to economic growth. However, the interaction of digital payments (proxied by mobile transfers) and financial inclusion had a negative and statistically significant impact on economic growth. In contrast, the interaction of mobile money and financial inclusion showed a positive and significant effect on economic growth. The study concludes thus, that the interactive effect between digital payment and financial inclusion has a positive impact on economic growth in the selected West African countries. Based on the findings, this study recommended that mobile money offers a stronger economic potential, and should therefore, be used more as a preferred digital payment channel to enhance financial inclusion and economic expansion in West Africa. The study concluded that economic growth will be boosted if digital payments is strengthened more in financial inclusivity
IMPACT OF FINANCIAL INCLUSION AND ENERGY CONSUMPTION ON ENVIRONMENTAL QUALITY IN SELECTED SUB-SAHARAN AFRICAN COUNTRIES
(Covenant University Ota, 2025-08) OLAOYE, Olugbenga Olaposi; Covenant University Dissertation
Sub-Saharan Africa (SSA) faces a pressing development dilemma: rising energy demand, weak financial inclusion, and worsening environmental degradation. The region’s reliance on fossil fuels such as coal, gas, and oil has intensified carbon emissions and undermined environmental sustainability, while the exclusion of a significant share of the population from formal financial systems constrains their ability to invest in clean energy and sustainable practices. Despite growing global advocacy for inclusive finance and clean energy adoption, existing research provides limited evidence on how financial inclusion moderates the energy–environment nexus, particularly within SSA. Furthermore, the potential influence of structural breaks—such as global financial crises, international climate agreements, and pandemics—on this relationship remains underexplored. These gaps informed the motivation for this study. This research examined the impact of financial inclusion on the relationship between energy consumption and environmental quality across 38 low- and middle-income SSA countries between 1991 and 2022. Anchored on the Environmental Kuznets Curve (EKC) hypothesis, the study employed annual secondary data sourced from the World Bank’s World Development Indicators. The Cross-Sectional Autoregressive Distributed Lag (CS-ARDL) model was the principal estimation technique, as it accounts for cross-sectional dependence and heterogeneity while capturing both short- and longrun dynamics. To ensure robustness, the Pooled Mean Group (PMG) estimator was also applied. The empirical results show that energy consumption significantly worsens environmental quality across the region, with middle-income countries exhibiting a stronger positive association between energy use, capital investment, and carbon emissions. Real GDP and gross capital investment further contributed to emissions, reflecting the industrial expansion of African economies. In contrast, the quality of environmental regulation was negatively associated with emissions, indicating its mitigating role, though implementation remains uneven across countries. Financial inclusion was found to be a critical determinant of environmental outcomes: in middle-income economies, greater inclusion significantly reduced emissions by enabling access to credit, green finance, and adoption of cleaner technologies. However, in low-income countries, the short-term effects of financial inclusion on environmental quality were positive but statistically insignificant, reflecting structural constraints in their financial systems. The study concludes that financial inclusion can serve as a viable policy instrument for environmental sustainability in SSA. Expanding inclusive finance, strengthening regulatory enforcement, and aligning financial innovations with Nationally Determined Contributions (NDCs), the Sustainable Development Goals (SDGs), and Africa’s Agenda 2063 are vital for promoting clean energy adoption and building climate-resilient economies.
DIGITAL TECHNOLOGY EXPOSURE AND FEMALE YOUTHS’ LABOUR FORCE PARTICIPATION IN NIGERIA
(Covenant University Ota, 2025-08) BABALOLA, Charity Ifelolorun; Covenant University Dissertation
Amidst the growing global attention on the role of technology in driving economic inclusion, it is important to understand the impact of digital technology exposure on young women in developing countries like Nigeria which is paramount for policy and development outcomes in transforming in human capital and the economy of the country. This study explores the effect of digital technology exposure on labour force participation among female youths in Nigeria, within the broader context of socioeconomic and regional inequality that exists in female employment and access to digital technology. The data for the study is from the 2018 Nigeria Demographic and Health Survey (NDHS), focusing on females between age 15 and 30. Three kind of analysis was conducted: univariate, bivariate (cross tabulation and chi-square), and multivariate (binary logistic regression analysis) to examine the effects of background factors (age, highest level of education, marital status, wealth, residence and Religion), contextual factors (region, and mass media exposure) and digital technology exposure (Use of internet, frequency of use, mobile phone ownership and use of mobile phone for financial transaction) on labour force participation. The key findings of this study revealed that digital technology exposure is a significant predictor of employment among female youths. However, disparities persist across regions, education levels, and socioeconomic groups in access to digital technology and labour force participation. Media exposure was also found to positively influence both digital access and labour participation. The study also revealed that access to and the use of digital tools such as mobile phones and mobile financial tools are strong predictors of female labour force participation. These results emphasise the need for targeted interventions to promote digital inclusion and economic opportunities for young women in Nigeria.
IMPACT OF CLIMATE CHANGE AND WAGE INCOME ON FOOD SECURITY OF FEMALE-HEADED HOUSEHOLDS IN SELECTED WEST AFRICAN COUNTRIES
(Covenant University Ota, 2025-09) ODE OMENKA, Loveth Chiduma; Covenant University Thesis
The critical relevance of food security in West Africa cannot be overemphasised due to the regional level of vulnerability which is driven by conflict, displacement, economic instability, and severe climate shocks. Food security in the West African region faces mounting challenges and climate change has emerged as one of the most significant drivers of the current food crisis. This study represents one of the few empirical investigations that analyzed the impact of climate change and wage income on food security, particularly by comparing households experiencing severe climate change to those without. The broad objective of this research is to examine how climate change and wage income affects food security across West African countries with a particular focus on Nigeria and Senegal. The study is supported by the Resilience Theory which explores household capacity to withstand environmental shocks and the Sustainable Finance Theory, which emphasises the importance of economic stability and inclusion in ensuring long-term food access. A mixed-methods approach was employed to capture both quantitative and qualitative dimensions of the research problem. Quantitative data were obtained from the Living Standards Measurement Study-Integrated Surveys on Agriculture (LSMS-ISA), while qualitative data were collected through fieldwork across selected rural communities. The study utilised Statistical techniques such as Logistic Regression and Propensity Score Matching (PSM) to estimate the effect of climate change exposure and livelihood factors on food consumption outcomes. Geospatial technique was also used to graphically represent the impact of Climate Change. The qualitative analysis complemented the statistical findings with insights from the field especially highlighting gendered dimensions of agricultural labour wage and food consumption. Findings from Nigeria revealed that households exposed to severe climate change experienced 11.1% reduction in food consumption adequacy. Households with female agricultural wage earners had significantly higher odds (55.3%) of achieving high food consumption levels. Climate change was associated with a 10.15% decrease in the likelihood of adequate food consumption (Coefficient: −0.102; T-statistic: −45.77, p<0.001), emphasising the negative impact of environmental stress on food access. Notably, the interaction between climate change and household wage (Coefficient: 0.724; z = 14.56, p<0.001) showed positive influence indicating that wage stability can moderate the adverse effects of climate disruptions. In contrast, findings from Senegal revealed a marginally positive relationship between severe climate change exposure and food consumption (Coefficient: 0.219; p = 0.056), likely due to the presence of food aid, adaptation strategies, and coping mechanisms. However, the absence of female agricultural wage earners significantly reduced food consumption (Coefficient: −0.485; p = 0.003), reinforcing the importance of gender inclusion in the agricultural sector economy. Food purchases emerged as a critical determinant of food consumption in both countries, linking market access and household income directly to food security. This study recommends that policymakers implement integrated strategies that promote climate resilience, increase household income through wage diversification and empower women in agriculture. Therefore, investment in climate-smart agriculture, social protection programs, market stabilisation mechanisms, and gender-sensitive employment policies are essential to ensure sustainable food security in West Africa. Keywords: Climate Change, Food Security,
Financial Deepening and Economic Growth Nexus in Nigeria
(Scitech Journal, 2026) OMANKHANLEN, Alexander Ehimare; Omokore, David Eyitayo; Olusuyi Ajayi; Akinjare, Victoria Abosede
This study explored the relationship between financial deepening and economic growth in Nigeria over the period 1971 to 2020. The literature presents differing views on whether financial deepening has a positive effect on economic growth, prompting further empirical investigation. Annual data on key variables-such as lending interest rate, bank capital, bank liquid reserves, domestic credit, and stock traded-were obtained from the World Bank Indicators. The analysis employed an Ordinary Least Squares (OLS) regression model to assess the effects of these variables on Nigeria’s GDP. The results indicated that bank liquid reserves had a positive and statistically significant impact on GDP at the 5% significance level, while domestic credit and stock traded were positive but not statistically significant. Based on these findings, the study recommends that the Central Bank of Nigeria (CBN) urgently reconsider its monetary policy rate and the volume of financial resources allocated to the private sector. Additionally, measures should be introduced to cushion the effects of disinvestment and to promote policies that enhance income, liquidity preferences, and savings behavior among citizens, all of which can contribute to a more resilient economy. Finally, financial institutions are encouraged to develop a wider range of financial instruments to attract investors and mobilize idle funds for productive investments.
INDUSTRIAL POLICY AND TRADE COMPETITIVENESS UNDER AFCFTA: EVIDENCE FROM NIGERIA’S TEXTILE AND APPAREL SUB-SECTOR
(Covenant University, Ota, 2026) OBISESAN, Mojolaoluwa Ruth; Covenant University, Dissertation
Nigeria's textile sub-sector was once among the largest in Sub-Saharan Africa (SSA), but it has experienced a persistent decline in trade competitiveness despite decades of industrial policy interventions. Structural macroeconomic constraints, including exchange rate volatility, energy deficits, inflationary pressures, and weak institutional effectiveness, have compounded this decline, raising urgent questions about existing policy frameworks. The African Continental Free Trade Area (AfCFTA) has further heightened this urgency, as the phased liberalisation of tariffs exposes domestic producers to intensified regional competition. This study investigates the effects of industrial policy and structural macroeconomic variables on trade competitiveness in Nigeria’s textile sub-sector under the AfCFTA. It examines the long-run and short-run effects of tariff protection, the real effective exchange rate, electricity consumption, inflation, and government effectiveness on trade competitiveness, as measured by the Balassa Revealed Comparative Advantage index. Adopting a mixed-methods design, the quantitative component employs the Autoregressive Distributed Lag bounds testing approach using annual time-series data spanning 1996 to 2023, while the qualitative component conducts a structured content analysis of primary AfCFTA framework documents extending to 2025. The findings reveal that tariff protection and electricity consumption have significant long-run effects on trade competitiveness, whereas the real effective exchange rate, inflation, and government effectiveness are not statistically significant. The content analysis reveals that AfCFTA's rules of origin framework and phased tariff liberalisation create a dual constraint that Nigerian producers cannot currently navigate. The study recommends performance-conditioned tariff restructuring, dedicated industrial electricity provision, upstream supply chain development, and active engagement with AfCFTA's rules of origin criteria as prerequisites for sub-sectoral competitiveness.
ASSESSMENT OF GREEN FINANCE ON ECONOMIC GROWTH AND INCOME INEQUALITY IN NIGERIA
(Covenant University, Ota, 2026-05) Ojo, Abigail Victory; Covenant University Dissertation
This study examines the impact of green finance on economic growth and income inequality in Nigeria over the period 1990-2024. The motivation for the study arises from the increasing global emphasis on green finance as a tool to curb the effects of climate change and promotion of economic growth that is beneficial to all and this raises the need to understand its macroeconomic and distributional implications in a developing economy like Nigeria. Specifically, the study investigates the effect of green finance on economic growth and income inequality while incorporating key control variables such as inflation, unemployment, foreign direct investment, labour force participation, and Trade openness. The study employs annual time-series data and adopts the Autoregressive Distributed Lag (ARDL) bounds testing approach and a robustness test to confirm results. The empirical findings reveal that green finance has a significant but negative impact on economic growth in the short and long-run and also a positive and statistically significant effect on income inequality in both the short run and long run. The robustness test revealed that a higher level of renewable energy consumption reduces income inequality in Nigeria. Overall, the study suggests that the green finance sector in Nigeria is still at a developmental stage and may involve transitional costs, inefficiencies, and delayed returns. Additionally, the results indicate that macro-economic indicators have mixed effects on economic growth and income inequality, It recommends the promotion of inclusive green finance policies, strengthening of regulatory frameworks, and improved access to green funding for small and medium enterprises and low-income groups to ensure that green finance contributes to both economic growth and equitable income distribution.
ANALYSIS OF TELEMIGRATION AND YOUTH UNEMPLOYMENT IN SELECTED SUB-SAHARAN AFRICAN COUNTRIES
(Covenant University, Ota, 2026-06) AMBRO-MOYE, KECHIRO JULIET; Covenant University, Dissertation
The study analyses telemigration and youth unemployment across selected Sub-Saharan African (SSA) countries. It investigates how electricity availability, internet penetration, and educational attainment influence young people’s ability to engage in telemigration and, by extension, impact youth unemployment. The study contributes to the body of literature on the future of work by supporting Sustainable Development Goal (SDG) 8, which is about decent work and economic growth, and Sustainable Development Goal (SDG) 9, which covers industry, innovation, and infrastructure. With the use of a quantitative research approach, the study analyses the panel data from 31 selected Sub-Saharan African (SSA) countries from 2017 to 2024, applying Fixed Effects and Random Effects panel regression, cross-sectional dependence diagnostics, and dynamic Panel Generalised Method of Moments (GMM) estimation to yield robust and unbiased findings. The findings from the study show that internet penetration and educational attainment significantly affect youth participation in telemigration, while electricity access, though it is important, it exhibits an uneven effect. This is because of infrastructural inconsistencies across the countries. The GMM results show that telemigration significantly reduces youth unemployment in the selected Sub-Saharan African (SSA) countries. In addition, the results show that persistent structural barriers, including digital inequality, skills gaps, and institutional weaknesses, limit the full potential of telemigration in the region. It offers policy recommendations, emphasising that governments across Sub-Saharan Africa (SSA) should actively expand mobile money and digital banking infrastructure to enable youth to receive cross-border payments from telemigration platforms efficiently and at low cost. Reducing transaction costs and improving financial inclusion for youth digital workers will increase net earnings from telemigration and strengthen its impact in reducing youth unemployment. The cross-sectional dependence among Sub-Saharan African (SSA) countries in the study means that telemigration shocks and opportunities spill across national borders. Regional bodies such as the African Union, the Economic Community of West African States (ECOWAS), and the East African Community (EAC) should facilitate regional digital infrastructure corridors, harmonised digital skills standards, and cross-border payment systems that enable youth telemigrants to efficiently receive earnings. The African Continental Free Trade Area (AfCFTA) framework should incorporate explicit provisions for digital services trade and telemigration, creating a policy environment that amplifies the employment benefits of telemigration at the continental scale. The study explains that telemigration can serve as a reliable pathway for youth employment and economic transformation in Sub-Saharan Africa (SSA), provided that critical structural constraints are effectively addressed.
EFFECT OF ECONOMIC DIVERSIFICATION AND INNOVATION ON YOUTH UNEMPLOYMENT IN NIGERIA
(Covenant University, Ota, 2026-08) Adamolekun, Omolola Janet; Covenant Univbersity Dissertation
This study examined the connection between innovation, economic diversification, and youth unemployment in Nigeria and evaluated the degree to which innovation and economic diversification had an impact on youth unemployment. This was done in order to investigate the relationship between economic diversification, innovation, and youth unemployment in Nigeria between 1994 and 2024. The study made use of secondary data. Data on youth unemployment (proxy for youth unemployment), scientific and technical journal articles (proxy for innovation), and mobile phone subscriptions were obtained from the World Bank World Development Indicators. However, the Shannon Index (a proxy for economic diversity) and trade openness were calculated using information from the Central Bank of Nigeria (CBN) statistics bulletin, and information on government spending was also obtained from the same source. Data was analysed in accordance with the study objectives using the Augmented Dickey Fuller (ADF) Unit root test, Autoregressive Distributed Lag (ARDL) bounds test for cointegration, and Autoregressive Distributed Lag (ARDL) estimation based on the discovery that variables were at a mixture of orders of integration of zero and one. According to the study's findings, there was a long-term relationship between innovation, economic diversification, and youth unemployment in Nigeria. However, the error correction term showed that 59.80% of deviations from equilibrium are corrected over the long term. Innovation was found to have a significant positive relationship with youth unemployment in the short term and a significant negative relationship with youth unemployment in the long run, while economic diversification had an insignificant relationship with youth unemployment in both the short and long term. Furthermore, whereas government spending was important for lowering youth unemployment in the long run only, mobile phone subscriptions increased youth unemployment in both the short and long term. Additionally, the relationship between innovation and economic diversification had a significant impact on youth unemployment in both the short and long term. However, in the short term, this interaction increased youth unemployment while in the long term it amplified the decline in youth unemployment. Based on the aforementioned findings, the study suggested, among other things, that the Nigerian government prioritise targeted investment in education and skill development, especially in STEM fields, digital literacy, and vocational training; that public spending be redirected toward industries with high employment potential, such as education, technology, and industrial development; and that policies be shifted from access to utilisation of digital infrastructure by encouraging digital entrepreneurship, remote work opportunities, and tech-enabled small businesses.
EFFECT OF DIGITAL INFRASTRUCTURE AND GREEN INNOVATION ON ENVIRONMENTAL OUTCOMES IN SUB-SAHARAN AFRICA
(Covenant University, Ota, 2026-08) Obi, Chibuzor Happiness; Covenant University Dissertation
Digital infrastructure has been seen as a force of change for sustainable development, but in Sub-Saharan Africa, the environmental impact of digital infrastructure is poorly understood. This study investigates the impact of digital infrastructure on environmental outcomes in Sub-Saharan Africa, focusing on the potential intermediate path of green innovation, but also identifying threshold conditions where digital growth can foster emissions reductions. The study employs a balanced panel of 40 Sub-Saharan African countries from 2001 to 2022 and uses a dynamic panel-data framework to examine how digital infrastructure is linked to carbon dioxide emissions. It also applies mediation analysis to test whether green innovation mediates the impact of digital infrastructures on environmental outcomes, and threshold analysis to see if such impact is different after a specific level of connectivity is attained. The composite index of key information and communication technology indicators is used to measure digital infrastructure. The main environmental indicator is CO2 emissions per capita, with wider environmental indicators also checked. Renewable energy use as a percentage of total final energy use serves as a proxy for green innovation, as well as renewable electricity output as a percentage of total electricity generation. The study demonstrates that digital infrastructure can have a positive impact on environmental effects, but its effectiveness is conditioned on the quality of connectivity, how much digital infrastructure expansion can foster green innovation, and the availability of cleaner energy systems. An important point to emphasize, however, is the need for suitable green innovation indicators in low-income settings, as traditional use of biomass does not necessarily indicate modern use of clean energy. The study adds to the literature by bringing together direct, mediation and threshold approaches under one umbrella and offers policy recommendations for digital economy planning, climate finance, clean energy investment and sustainability measurement in Sub-Saharan Africa
ASSESSMENT OF INTRNATIONAL TRADE ON SELECTED SECTORAL PERFORMANCE IN ECOWAS COUNTRIES: A MEDIATING ROLE OF INDUSTRIALISATION
(Covenant University, Ota, 2026-08) Kayode, Maria Oluwabukola; Covenant University Dissertation
This study investigates the impact of international trade on sectoral performance across the agricultural, manufacturing, and services sectors in fifteen Economic Community of West African States (ECOWAS) member countries, with a emphasis on the mediating role of industrialisation. Using panel dataset covering the period 2005–2024., sourced from World Development Indicators (WDI) and International Financial Statistics (IMF Data Portal). The study employs the Panel Autoregressive Distributed Lag (P-ARDL) model estimated through the Pooled Mean Group (PMG) approach to capture both short-run dynamics and long-run equilibrium relationships. Pre-estimation diagnostics confirmed the absence of significant cross-sectional dependence and mixed orders of integration among variables, validating the suitability of PMG-ARDL framework. The empirical findings reveal heterogeneous relationships across sectors. International trade proxied by Merchandise export significantly affects sectoral performance in the long run.Trade positively affects the agricultural sector, reflecting the dominance of primary commodity exports in ECOWAS economies. However, it negatively affects the manufacturing and services sectors, indicating weak spillover effects and limited structural transformation within the region. No significant short-run effects of trade were observed across the three sectors. The mediation analysis further reveals that industrialisation does not significantly mediate the relationship between trade and services sector performance. However, industrialisation partially mediates the relationship between trade and agricultural performance by transforming trade’s initial negative direct effect into a positive overall effect. In the manufacturing sector, industrialisation exhibits a suppression effect by intensifying the adverse impact of trade on manufacturing performance. The study concludes that although international trade significantly influences sectoral performance and promotes industrial development, the mediating role of industrialisation remains constrained by persistent dependence on primary commodity exports and weak industrial linkages across ECOWAS countries. The study therefore recommends policies aimed at export diversification toward higher value-added manufactured products, alongside increased investment in agro-industrialisation to strengthen productive capacity, enhance inter-sectoral linkages, and improve sectoral performance within the region.
EFFECT OF FINANCIAL CONDITIONS INDEX ON MONETARY POLICY EFFECTIVENESS IN NIGERIA
(Covenant University, Ota, 2026-08) EGBE, IWASAM EJA; Covenant University Dissertation
This study evaluated the impact of the Financial Conditions Index (FCI) on the effectiveness of monetary policy in Nigeria. Existing studies on Nigeria's FCI suffer from an outdated scope, exclusion of critical financial variables, and limited representation of the country's inflationary and growth dynamics. This study, therefore, aimed to construct a comprehensive FCI and assess its usefulness as a diagnostic and predictive tool for monetary policy in Nigeria. Specifically, the study examined the financial variables most suitable for constructing a robust FCI for Nigeria, analysed the dynamic response of the constructed FCI to monetary shocks and evaluated its predictive capacity for real GDP growth and inflation. A quantitative research design was employed for this study, using quarterly data from the Central Bank of Nigeria Statistical Bulletin, covering the period 2010Q1 to 2024Q4. Two FCI construction methodologies were adopted: Principal Component Analysis (PCA) and the Weighted-Sum Vector Autoregression (VAR) method. Impulse Response Functions, Pairwise Granger Causality tests, and out-of-sample Root Mean Squared Error (RMSE) evaluations were used to assess the index's responsiveness and predictive power. The findings revealed that the selected financial variables significantly contributed to FCI construction, with the first three principal components capturing about 93.05% of the total variance. Both FCIs responded significantly to monetary policy shocks primarily through the interest rate and exchange rate channels. The PCA-FCI demonstrated superior predictive power for real GDP growth, while inflation was found to Granger-cause both indices, indicating reverse causality. The study concludes that monetary policy effectiveness in Nigeria is better assessed through a composite financial conditions framework than through isolated policy rate indicators. It is therefore recommended that the Central Bank of Nigeria formally incorporate the PCA-based FCI into its policy diagnostic toolbox and place greater emphasis on price-based transmission instruments over credit volume controls.
EFFECTS OF MONETARY POLICY AND DETERMINANTS OF BALANCE OF PAYMENT ON ECONOMIC GROWTH IN NIGERIA
(Covenant University, Ota, 2026-08) SAMUEL, Tolowani Lois; Covenant University, Dissertation
Nigeria's macroeconomic landscape has been characterised by persistent balance of payments pressures, exchange rate volatility, weak monetary policy transmission, and sluggish economic growth, challenges that have intensified the policy debate on the appropriate role of monetary policy and external sector management in driving sustainable long-run economic growth. Against this backdrop, this study examined the effects of monetary policy and the determinants of balance of payments on economic growth in Nigeria over the period 1986 to 2024, with four specific objectives: to ascertain the key determinants of the balance of payments in Nigeria; to assess the impact of balance of payments determinants on economic growth; to determine the impact of monetary policy on economic growth; and to examine the interaction effect of the monetary policy rate and the real exchange rate on economic growth. The study employed the Autoregressive Distributed Lag (ARDL) Bounds Testing Approach developed by Pesaran, Shin and Smith (2001) across three econometric models. The key findings revealed that oil price is the dominant long-run determinant of Nigeria's balance of payments, with a positive and significant coefficient of 35.829 (p = 0.0006), while broad money supply exerted a significant negative long-run effect on the current account balance with a coefficient of -1.156 (p = 0.0033). Real exchange rate depreciation also worsened the current account balance in the long run with a coefficient of -0.014 (p = 0.0272). With respect to economic growth, trade openness emerged as the strongest positive long-run growth driver with a coefficient of 0.797 (p = 0.0000), while oil price exerted a counterintuitive negative long-run effect on growth with a coefficient of -2.150 (p = 0.0000). The monetary policy rate exerted a significant negative long-run effect on economic growth with a coefficient of -0.031 (p = 0.0019). Most significantly, the interaction term between the monetary policy rate and the real exchange rate (MPR×REXR) returned a negative and highly significant long-run coefficient of - 0.328 (p = 0.0000), establishing that the simultaneous pursuit of monetary tightening and exchange rate depreciation generates compounded contractionary effects on Nigerian economic growth that are substantially more damaging than either force acting independently. The study concludes that Nigeria’s growth is constrained by oil dependence, import intensity, and the compounded contractionary effect of monetary tightening and exchange rate depreciation. The study recommends export diversification, targeted monetary management, and stronger coordination of monetary and exchange rate policies.
EFFECTS OF PROFIT SHIFTING, TAX HAVEN AND FISCAL SPACE IN DEVELOPING ECONOMIES: EVIDENCE FROM SELECTED SUB-SAHARAN AFRICA
(Covenant University, Ota, 2026-08) PAUL, Samuel Micheal; Covenant University, Dissertation
Losses of domestic revenue and fiscal sustainability have become more critical areas of concern in Sub-Saharan Africa (SSA) as the use of tax haven jurisdictions by enterprises becomes more prevalent and the number of multinational corporations (MNCs) operating in the region grows. Increased demands for expenditure have been met by limited fiscal space available for developing governments to pursue developmental priorities in the face of these challenges. While there is a wealth of literature on tax avoidance in the rest of the world, literature to date on implications for fiscal space in SSA is still limited, with only a few empirical pieces trying to come to terms with the institutional and macroeconomic factors. In this study, hence, the impact of profit shifting and tax haven exposure on fiscal space in selected Sub-Saharan African economies was therefore examined. Specifically, the study looked at the impact of profit shifting on fiscal space, the impact of tax haven exposure on fiscal space, and the effect of government strength, trade openness, resource dependence, and income levels (GDP per capita) on fiscal space. The study employed an unbalanced panel dataset comprising fourteen selected Sub-Saharan African economies over the period 2000–2024. Secondary data were gathered from well-known macroeconomic and fiscal databases from international institutions. For the analysis, descriptive statistics, correlation analysis, Panel unit root tests, the Pedroni cointegration test, the Hausman specification test and the Random Effects estimation technique were utilized. The results indicated that there is a strong impact of profit shifting and tax haven exposure on fiscal space in the economies under study. There was also positive impact of trade openness and a small positive impact of resource dependence on fiscal space. On the other hand, the impact of governances quality and GDP per capita was not statistically strong during the study period. The results indicate that fiscal consequences of international tax practices depend on the institutional capabilities and economic systems of countries. The study builds on the existing literature by offering a long-run panel based evidence on the profit shifting–tax haven–fiscal space nexus in Sub-Saharan Africa. The findings underline the need for country-specific transfer pricing law and tax transparency and for a more strengthened tax cooperation in the region, as well as for country-specific fiscal reform that can contribute to sustainable domestic resource mobilisation and fiscal space for long-term development, from a policy perspective.