Effect of Fuel Subsidy on Standard of Living
Effect of Fuel Subsidy on Standard of Living

Summary/Abstract: The purpose of this study was to determine the effect of fuel subsidy on the standard of living in Nigeria for the period 1991-2022. Specifically, the study sought to examine the effect of petroleum price on the standard of living. to assess the effect of subsidy budget on the standard of living, and to determine the effect of crude oil price on the standard of living in Nigeria. Ex-post facto design was used based on the obtained secondary data from the statistical bulletin of the Central Bank of Nigeria. Given the nature of hypothesis formulated to guide the research, the data were analyzed using descriptive statistics and inferential statistics. The study also employed the use of Auto Regressive distributive lag (ARDL). The study established that crude oil price and petroleum price have negative and significant effect on living standard when measured by GDP per capita by 56.62% and 52.89% respectively. The study also found that there was an insignificant and positive effect on GDP per capita to the tune of 1.02%. The study concluded that subsidy has negative and significant effect on living standard in Nigeria. The study recommended that based on the findings, government should formulate policies that can increase job creation through promotion of industrial expansion. Finally, the study also recommended that budget on subsidy can be increased provided it will remove untold hardship of Nigerians.

• Details
• Contents