AGGREGATE DEMAND SHOCK AND ECONOMIC GROWTH IN NIGERIA.

Authors: CRAIG, A.O, FADEDAMOLA, M.A, PETERS, S.O & ABERUAGBA, O.T (Department of Accounting Ekiti State University, Nigeria. Department of Accountancy, D.S. Adegbenro ICT Polytechnic, Itori-Ewekoro. Department of Banking & Finance, D.S Adegbenro ICT Polytechnic, Itori-Ewekoro. Correspondence: Mohammedakande016@gmail.com; Mobile: 08060003398.

Journal: Nigerian Journal Of Technical Education | Volume: 23 | Issue: 2 | Pages: 105 - 120

Keywords:Aggregate Demand, Economic Growth, Total Expenditure, Gross Domestic Product, Gross National Income.

Abstract

This study examines how aggregate demand shocks impact economic growth in Nigeria, from 1985 to 2022, employing time-series data, econometric methodologies, and macroeconomic models. The analysis reveals a significant positive relationship between total expenditure (a proxy for aggregate demand) and economic key indicators, namely Gross Domestic Product (GDP) and Gross National Income (GNI). Specifically, a unit increase in total expenditure is associated with an approximate increase of 18,410.41 units in GDP and 0.076200 units in GNI. The findings highlight the crucial significance of investment, consumption and government expenditure in stimulating economic growing. The study recommends that policymakers should consider increasing total expenditure to enhance economic growth, ensuring efficient and targeted spending aligned with broader economic goals. This study enhances the awareness of various variables that influence economic growth in Nigeria, highlighting the importance of data-driven economic policy.