Monetary and Fiscal Policy Coordination in Nigeria: A Set Theoretic Approach
Monetary and Fiscal Policy Coordination in Nigeria: A Set Theoretic Approach

Summary/Abstract: In this article, we use the Set Theoretic Approach (STA) to determine the extent of coordination between monetary and fiscal policies in Nigeria from 1981 to 2015. Our main findings generally indicate a weak level of policy coordination estimated to be 17%. A further disaggregation of the results showed that the highest level of coordination of 36.4% occurred during the period of low growth and high inflation. However, there was no evidence of coordination during periods of high GDP growth and inflation. These findings point to the obvious need for fiscal and monetary authorities to strengthen policy coordination towards enhanced macroeconomic stability.

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