Monetary Transmission Channel, Oil Price Shock and the Manufacturing Sector in Nigeria

• Autorzy: Adeleke Omolade , Philip Nwosa , Harold Ngalawa
• Języki publikacji: EN

Abstrakty

EN

Research background: The need for diversification of the Nigerian economy has been emphasized and the manufacturing sector has a major role in this. Being an oil producing country, monetary policy is an important macroeconomic policy that has always been used to manage the influence of oil price shock on the manufacturing sector. Purpose: The study examines the relationship between oil price shock, the monetary transmission mechanism and manufacturing output growth in Nigeria. Research methodology: The study applied the structural vector auto regression (SVAR) modelling technique and a descriptive analysis. Results: The results of the study show that the exchange rate is mostly affected by the oil price shock, while the monetary policy instruments and inflation rate are also very responsive to the exchange rate shock. The manufacturing sector output growth has also been shown to be strongly affected by the inflation rate and monetary policy shocks. Novelty: The study has revealed the most effective channel via which oil price shocks affect manufacturing output. The exchange rate channel of the monetary policy transmission mechanism is the most significant channel through which oil price shock affects manufacturing output growth in Nigeria. This shows that effective management of the exchange rate policy via the appropriate monetary policy approach can be used to minimize the adverse effect of oil price shocks on Nigerian manufacturing output. (original abstract)

Słowa kluczowe

EN

Oil prices; Transmission of shocks; Industry

PL

Ceny ropy naftowej; Transmisja zjawisk szokowych; Przemysł

• Czasopismo: Folia Oeconomica Stetinensia
• Rocznik: 2019
• Numer: vol. 19, iss. 1
• Strony: 89--113

Twórcy

autor

Adeleke Omolade

• University of KwaZulu-Natal, South Africa

autor

Philip Nwosa

• Federal University Oye Ekiti, Nigeria

autor

Harold Ngalawa

• University of KwaZulu-Natal, South Africa

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Identyfikatory

DOI

https://doi.org/10.2478/foli-2019-0007