Premium Motor Spirit (PMS) Pricing and Inflationary Dynamics in Nigeria

• Autorzy: Olawale Isaac Wale-Awe , Luqman Adedamola Sulaiman
• Języki publikacji: EN

Abstrakty

EN

The study examines the effect of PMS pricing on inflationary dynamics in Nigeria between 1980 and 2018. Inflation was used as the dependent variable for the study, while the prices of PMS (Premium Motor Spirit, simply called petrol), AGO (Automotive Gas Oil, simply called diesel), and DPK (Dual Purpose Kerosene, simply called kerosene), as well as the exchange rate, were used as independent variables. The study employed the ARDL and causality techniques for analysis. It was discovered in the study that the price of PMS increases inflationary tendencies in the country. Meanwhile, the causality test revealed the absence of causality between PMS pricing and inflationary dynamics in Nigeria. Thus, the study recommended that the government should stabilise the price of PMS and align it with the wage rate. (original abstract)

Słowa kluczowe

EN

Oil prices; Inflation; Dependency analysis

PL

Ceny ropy naftowej; Inflacja; Analiza zależności

• Czasopismo: Forum Scientiae Oeconomia
• Rocznik: 2020
• Tom: 8
• Numer: nr 3
• Strony: 49--60

Twórcy

autor

Olawale Isaac Wale-Awe

• Strides Educational Foundation, Nigeria

autor

Luqman Adedamola Sulaiman

• Ekiti State University, Nigeria

Bibliografia

• Akpaeti, A. (2018), Petrol pump prices fluctuation and agricultural productivity in Nigeria 1970-2016: A vector error correction approach, London Journal of Research in Science: Natural and Formal.
• Aminu, S.A. Olawore, O.P. (2014), Empirical investigation of challenges of distribution of Premium Motor Spirit (PMS) in Federal Capital Territory (FCT), Abuja and Environs, Nigeria, International Journal of Management Sciences and Humanities, 2(2), 17-59.
• Benghida, S. (2017), Factors and challenges in developing countries under the resource curse, retrieved from: https://hal.archives-ouvertes.fr/hal-01653339/, (accessed 2 August 2020).
• Blair, J.M. (1976), The control of oil, New York, NY: Pantheon Books.
• Bouchaour, C., Al-Zeaud, H.A. (2012), Oil price distortion and their impact on Algerian macroeconomic, International Journal of Business and Management, 7(18), 99-114.
• CBN (2018), CBN Statistical Bulletin 2018, Abuja: Central Bank of Nigeria.
• Choi, S., Furceri, D., Loungani, P., Mishra, S., Poplawski-Ribeiro, M. (2017), Oil prices and inflation dynamics: Evidence from Advanced and Developing Economies, IMF Working Paper Series.
• Dickey, D.A., Fuller, W.A. (1981), Likelihood ratio statistics for autoregressive time series with a unit root, Econometrica, 49(1), 1057-1072.
• Eregha, P.B., Mesagan, E.P. (2017), Energy consumption, oil price and macroeconomic performance in energy dependent African countries, Applied Economics, 46(1), 74-89.
• Eregha, P.B., Mesagan, E.P., Olawale, O.O. (2015), Petroleum products prices and inflationary dynamics in Nigeria, MPRA Paper Series, 1-16.
• Granger, C.W.J. (1969), Investigating causal relations by econometric models and cross-spectral methods, Econometrica, 37(1), 428-438.
• ICAN (2014), Advanced taxation, The Institute of Chartered Accountants of Nigeria Study Packs, Lagos, Nigeria.
• Isaac, J.O. (2017), Impact of change in petroleum products prices on inflation in Nigeria, M.Sc. thesis (unpublished), University of Lagos, Nigeria.
• Johansen, S., Juselius, K. (1990), Maximum likelihood estimation and inference on cointegration with applications to the demand for money, Oxford Bulletin of Economics and Statistics, 52(1), 169-210, https://doi.org/10.1111/j.1468-0084.1990.mp52002003.x (accessed 02 August 2020).
• Kapusuzoglu, A., Ulusoy, M.K. (2015), The interactions between agricultural commodity and oil prices: an empirical analysis, AgricEcon, 61(9), 410-421. https://doi.org/10.17221/231/2014-AGRICECON, (accessed 02 August 2020).
• Keynes, J.M. (1930), A treatise on money, New York, NY: Harcourt, Brace and Co.
• Klieman, K.A (2012), Oil companies, the Nigerian civil war, and the origins of opacity in the Nigerian oil industry, Journal of American History, 99(1), 155-165, https://doi.org/10.1093/jahist/jas072
• Malik, A. (2016), The impact of oil price changes on inflation in Pakistan, International Journal of Energy Economics and Policy, 6(4), 727-737.
• Moisé, G.M. (2020), Corruption in the oil sector: A systematic review and critique of the literature, The Extractive Industries and Society, 7(1), 217-236, https://doi.org/10.1016/j.exis.2020.01.002
• Mukhtarov, S., Mammadov, J., Ahmadov, F. (2019), The impact of oil prices on inflation: the case of Azerbaijan, International Journal of Energy Economics and Policy, 9(4), 97-102, https://doi.org/10.32479/ijeep.7712.
• Musa, A.S. (2014), An econometric investigation of the demand for petroleum products in Nigeria, International Journal of Economics, Commerce and Management, 2(11), 1-14.
• Nwoko, I.C., Aye, G.C., Asogwa, B.C. (2016), Effect of oil price on Nigeria's food price volatility, Cogent Food and Agriculture, 2(1), 1-15, https://doi.org/10.1080/23311932.2016.1146057
• Ocheni, S.I. (2015), Impact of fuel price increase on the Nigerian economy, Mediterranean Journal of Social Sciences, 6(1), 560-569. DOI:10.5901/mjss.2015.v6n1s1p560
• Odularu, G.O. (2007), Crude oil and the Nigeria economic performance, Oil and Gas Business, 1-29, retrieved from: http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.531. 822&rep=rep1&type=pdf (accessed 29 February 2020).
• Olomola, P.A., Adejumo, A.V. (2006), Oil price shock and macroeconomic activity in Nigeria, International Research Journal of Finance and Economics, 3, 28-34.
• Oluwaseyi, A.R. (2018), Oil price volatility spillover effects on food prices in Nigeria, retrieved from: https://ssrn.com/abstract=3292722 (accessed 20 July 2020).
• OPEC (2083), OPEC Annual Report, Vienna: OPEC Publications.
• Orlu, R.N. (2017), The impact of domestic pricing of petrol on economic growth of Nigeria (1970-2013), Global Journal of Social Sciences, 16(1), 1-8.
• Pesaran, H.M., Shin, Y. (1999), An autoregressive distributed lag modelling approach to co-integration analysis, in: S. Strom, A. Holly, P. Diamond (Eds.), Econometrics and economic theory in the 20th century, The Ragnar Frisch Centennial Symposium, United Kingdom: Cambridge University Press.
• Renou-Maissant, P. (2019), Is oil price still driving inflation? The Energy Journal, 40(6), 199-219, DOI: 10.5547/01956574.40.6.
• Ross, M.L. (2015), What have we learned about the resource curse? Annual Review of Political Science, 18, 239-259. https://doi.org/10.1146/annurev-polisci-052213-040359
• Samuelson, P.A. (1958), Economics: An introductory analysis, New York: McGraw- Hill.
• Solow, R.M. (1969), Price expectations and the behaviour of the price level: Lectures given in the University of Manchester: Manchester University Press.
• Sultan, Z.A., Alkhateeb, T.T.Y., Fawaz, M. M. (2020), Empirical investigation of relationship between oil price and inflation: The case of India, International Journal of Energy Economics and Policy, 10(3), 90-94. https://doi.org/10.32479/ijeep.9015
• Varma, S., Wadhwa, S., Deshmukh, S.G. (2007), Supply chain characteristics of the petroleum industry: The Indian context, South Asian Journal of Management, 14(2), 107-122.
• Zivkov, D., Duraskovic, J., Manic, S. (2018), How do oil price changes affect inflation in Central and Eastern European Countries? A Wavelet-based Markov switching approach, Baltic Journal of Economics, 19(1), 84-104. https://doi.org/10.1080/1406099X.2018.1562011

Identyfikatory

DOI

10.23762/FSO_VOL 8_NO3_3