MACROECONOMIC POLICIES AND INCLUSIVE GROWTH IN NIGERIA
The achievement of impressive growth without a reduction in poverty, inequality and unemployment resonate the inclusive growth debates. This study contributes to this debate by investigating the impact of macroeconomic policies on inclusive growth in Nigeria. The composite inclusive growth index for Nigeria was developed using twelve indicators and then an empirical analysis was conducted to examine how fiscal and monetary policies impacted on inclusive growth. Error correction mechanism and autoregressive distributed lag model were used to estimate fiscal and monetary policies model respectively given the order of integration. The results showed that monetary policy is relevant in enhancing inclusive growth while fiscal policy decreases inclusive growth in Nigeria. By and large, all the equations were relevant in explaining the dynamics of inclusive growth in Nigeria due to their relatively high explanatory power of about 53 per cent for fiscal policy equation, 65 per cent for monetary policy equation. Fiscal and monetary policies exhibited slow speeds of adjustment of 27.62 per cent and 25.89 per cent, respectively. The paper recommends that government should ensure her deficits financing expenditure are channelled towards growth stimulating sectors of the economy so as to create economic opportunities.
Macroeconomic policies, Monetary Policy, Fiscal Policy, Inclusive Growth