EFFECT OF SELECTED MACROECONOMIC VARIABLES ON THE NIGERIA ECONOMY

As the largest economy in Africa, Nigeria produces a large proportion of goods and services in the West African subcontinent and hence, her economy is affected by a number of micro and macro economic variables. The impact of some selected macroeconomic variables on the Nigeria economy for a period of thirty – eight years (1980 – 2017) was examined in this paper, using the gross domestic product (GDP) to represents the economy. At 5% significance level, only exchange rate and population growth rate significantly affects the Nigeria economy within the study periods. Unemployment rate (X1) and crude oil exports (X7) were found to be collinear, likewise exchange rate (X3) and foreign direct investment in Nigeria (X4). The error terms of the fitted model are positively autocorrelated while the error term of crude oil exports (X7) is not normally distributed. This paper recommends to future researchers, transformation or increase in sample sizes of those variables that did not conform to multiple regression assumptions.