Comparative Analysis of Monetary Policy Measures and Nigerian Economic Growth (2009 - 2018)

Abstract

Within the West African sub-region, Nigeria’s economy is huge enough as an attraction, although its growth rates fluctuate contrary to economic projections. The government has adopted a number of monetary policy measures to improve the economy over the years. This study is a comparative analysis of monetary policy measures in relation to economic growth for the period 2009-2018. As a problem for investigation, pre-research observation revealed gaps in monetary policy measures implementation which motivated this study. The overall objective of the paper was to determine the impact of monetary policy measures on economic growth. Secondary data were drawn and subjected to econometric analysis with highlights of vector auto regression and correlation analyses. One of the major findings is the critical role of the Central Bank of Nigeria (CBN) in consistently adjusting policies to address the status of the Nigerian economy. However, results showed among others that monetary policy is not the sole determinant of economic growth, although cash reserve ratio was found to have a significant impact on economic growth. In conclusion, while monetary policy provides the impetus for fiscal discipline, operational infrastructure and investment are necessary for growth. As part of recommendations, the CBN should be more disciplined in its approach at tracking open market operations and monitoring policy objectives.