Interest Rate and Private Consumption Behaviour in Nigeria: SomeEmpirical Evidences

This study examines the impacts of interest rate on private consumption behaviour in Nigeria between the period of 1981 and 2014 using autoregressive distributed lag (ARDL) co integrations framework. The data were sourced from the World Bank development indicators; interest rate was augmented with other macroeconomic variables like per capita income, money supply, and banking sector credit to the private sector as regresses in determining the behaviour of private consumption in Nigeria. The results confirm the existence of relationship between private consumption and its determinants, except real interest rate and the dummy for the impact of interest rate deregulation. The study therefore recommends increase in government capital expenditures that will create an enabling environment for the private sector to thrive so that the welfare of the citizenry could be enhanced