Oil Revenue and Nigeria Macroeconomic Performance: An Econometric Analysis

Considering the oil revenue stream and the slow rate of economic growth in the Nigerian economy, the study was carried out to ascertain the effects of oil revenue on the macroeconomic performance of Nigeria. This study made use of data obtained from the Central Bank of Nigeria (CBN) and the World Bank 1981 to 2014. The Ordinary Least Squared (OLS) technique and the Granger Causality test were used to ascertain the effect of oil revenue on Nigeria macroeconomic performance. The result shows that oil revenue is statistically significant to economic growth in Nigeria and a positive relationship exists between them. Co-integration result shows evidence of long run relationship between oil revenue and economic growth in Nigeria. However, the result of Granger causality test shows that oil revenue does not Granger cause Economic growth. The study recommends the implementation of the petroleum industry bill with alternative sources of revenue for greater economic performance.