Population Growth, Oil Price and Economic Growth Nexus in Nigeria

Abstract

This study examined the relationship between population, oil price and economic growth in Nigeria using the vector error correction model as well as impulse response and variance decomposition analysis for the period 1970 to 2013. The result of the analysis revealed that Nigeria's population has witnessed significant changes between 1960 up to the present period. The oil price data also revealed that significant changes were witnessed over the same period of study. The result further revealed that population growth and oil price, have positive effect on the real gross domestic product, thus making it conform to apriori expectation. Finally, the result of the impulse response as well as variance decomposition analysis showed clearly that both population growth and oil price have positive and stable impacts on real GDP in Nigeria over the forecasted period. The study therefore advocate that efforts should be geared towards reduction of infant and maternal mortality in Nigeria and the government should also work towards shoring up its earnings from oil sales as these would help improve the living standards of the Nigeria population.