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Inflation and Economic Growth Dynamics in Nigeria: Evidence from the SVEC Model and Frequency-Domain Causality Approach

The inflation-growth relationship has been a central issue in macroeconomic policy debates, particularly in developing economies like Nigeria. In this regard, this study examines the dynamic relationship between inflation and economic growth in Nigeria from 1981 to 2021. Specifically, it investigates the long-run impact of inflation on growth, the short-run adjustment process, and the direction of causality between them. The findings reveal a negative long-run relationship between inflation and economic growth, while interest rates and physical capital accumulation are positive long-run driver…

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