Macroeconomic Performance and Economic Wellbeing in Nigeria: Evidence From Hanke’s Misery Index

International Journal of Economics and Management Studies

© 2019 by SSRG - IJEMS Journal

Volume 6 Issue 6

Year of Publication : 2019

Authors : OKONJI, Okebuno Sunday ,Igbanugo Izuchukwu Clement

10.14445/23939125/IJEMS-V6I6P112

How to Cite?

OKONJI, Okebuno Sunday ,Igbanugo Izuchukwu Clement, "Macroeconomic Performance and Economic Wellbeing in Nigeria: Evidence From Hanke’s Misery Index," SSRG International Journal of Economics and Management Studies, vol. 6,  no. 6, pp. 70-83, 2019. Crossref, https://doi.org/10.14445/23939125/IJEMS-V6I6P112

Abstract:

Since late 2000 when Prof. Hanke of John Hopkin University began publishing misery index for most countries of the world, Nigeria has hardly fared well. In 2017 and 2018, the published index which measures the state of misery or wellbeing of the people in a country indicates that ranked the 6th most miserable country. This characterization imposed on the nation by Hanke’s misery index has been further corroborated by recent World Bank reports on poverty and inequality in Africa. Thus, there is renewed concern on how to reverse this ugly trend in Nigeria. In this study, we examined the role of macroeconomic performance in improving the wellbeing of the people. Using economic growth, debts, fiscal policy stance, monetary policy stance and efficiency of governance as measures of macroeconomic performance, we estimated a K-Class model with monthly time series from 1990 to 2017. The result obtained indicates economic growth, through allocative and distributive efficiency, engenders wellbeing improvement. Second, contractionary monetary policy that raises interest rate and unemployment rate has a dampening effect on wellbeing. The result obtained also indicates that excessive domestic borrowing that characterizes the Nigerian economy undermines the wellbeing of the Nigerian population. We therefore recommended that the monetary authority reconsiders its current stance on maintaining very high rediscount rate (or MPC in Nigerian parlance).

Keywords:

Misery, Wellbeing, Macroeconomic Performance ,JEL Classification: D63, E02

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