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Year 2016, Volume: 6 Issue: 4, 1930 - 1936, 01.09.2016

Abstract

Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model

Year 2016, Volume: 6 Issue: 4, 1930 - 1936, 01.09.2016

Abstract

Macroeconomic stability has not kept pace with the pattern of Public sector spending in majority of the developing countries. Unfortunately, past studies have mainly focused on the consequences of aggregate government spending on macroeconomic variables, or at most disaggregated government spending into capital and recurrent. In order to use government spending to effectively bring macroeconomic stability in developing countries, government spending must be decomposed according to sectors. Only very few studies have done this. We made effort to find out the components of government spending that cause macroeconomic instability in Nigeria, using Vector Autoregressive (VAR) Model. Result reveals government capital expenditure on economic services is the major cause of inflation in Nigeria. Impulse response function shows inflation will respond very sharp and positively to any shock in government capital spending in economic sector and social and community services. Therefore, if government must pursue economic stability through inflation control, she must re-examine her investment in those sectors.

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Details

Other ID JA63YS43NM
Journal Section Research Article
Authors

Joseph I. Amuka This is me

Miracle O. Ezeoke This is me

Fredrick O. Asogwa This is me

Publication Date September 1, 2016
Published in Issue Year 2016 Volume: 6 Issue: 4

Cite

APA Amuka, J. I., Ezeoke, M. O., & Asogwa, F. O. (2016). Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model. International Journal of Economics and Financial Issues, 6(4), 1930-1936.
AMA Amuka JI, Ezeoke MO, Asogwa FO. Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model. IJEFI. September 2016;6(4):1930-1936.
Chicago Amuka, Joseph I., Miracle O. Ezeoke, and Fredrick O. Asogwa. “Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model”. International Journal of Economics and Financial Issues 6, no. 4 (September 2016): 1930-36.
EndNote Amuka JI, Ezeoke MO, Asogwa FO (September 1, 2016) Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model. International Journal of Economics and Financial Issues 6 4 1930–1936.
IEEE J. I. Amuka, M. O. Ezeoke, and F. O. Asogwa, “Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model”, IJEFI, vol. 6, no. 4, pp. 1930–1936, 2016.
ISNAD Amuka, Joseph I. et al. “Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model”. International Journal of Economics and Financial Issues 6/4 (September 2016), 1930-1936.
JAMA Amuka JI, Ezeoke MO, Asogwa FO. Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model. IJEFI. 2016;6:1930–1936.
MLA Amuka, Joseph I. et al. “Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model”. International Journal of Economics and Financial Issues, vol. 6, no. 4, 2016, pp. 1930-6.
Vancouver Amuka JI, Ezeoke MO, Asogwa FO. Government Spending Pattern and Macroeconomic Stability: A Vector Autoregressive Model. IJEFI. 2016;6(4):1930-6.