Impact of Unemployment and Inflation on Standard of Living in Nigeria

Student: Abigail Stephen (Project, 2025)
Department of Economics and Development Studies
Federal University, Dutsin-Ma, Katsina State

Abstract

The study examines the relationship between unemployment and inflation on standard of living
in Nigeria from 1991 to 2023. The study employed the method of Auto Regressive Distributed
Lag (ARDL) bounds test for co-integration. The bound test result indicates that there is a long
run relationship between GDP per capita as proxy of standard of living, inflation rate and
unemployment rate. The theoretical framework of the study is endogenous growth model. The
findings reveal long-run equilibrium among the variables, underscoring the
interconnectedness of unemployment, inflation, government expenditure, and GDP per capita.
Overall, the empirical findings from ARDL demonstrates that unemployment and inflation
significantly affect the standard of living in Nigeria, based on the empirical findings the study
make the following recommendations. The government should introduce targeted employment
programs, particularly in sectors with high growth potential, to reduce unemployment and
improve the standard of living. Also, The Central Bank of Nigeria should closely monitor
inflation trends and adjust interest rates accordingly to maintain price stability

Keywords
impact unemployment inflation standard living nigeria
Filters
Institutions