Title: The Impact of Political Instability on Inflation Rates in Nigeria: An Empirical Investigation (1999-2023)
Authors: Uthman Mufutahu Oluwaseyi, Abulmalik Mustapha Dolapo
Volume: 10
Issue: 4
Pages: 195-200
Publication Date: 2026/04/28
Abstract:
This study examines the impact of political instability on inflation rates in Nigeria over the period 1999-2023. Despite the return to democratic governance in 1999, Nigeria has continued to experience persistent inflationary pressures, raising concerns about the role of political factors in macroeconomic performance. The study investigates whether political instability, characterized by electoral violence, policy inconsistency, governance challenges, and social unrest, significantly influences inflation dynamics in the country. Secondary data were obtained from the Central Bank of Nigeria, the World Bank, and the Worldwide Governance Indicators. The study adopts an ex-post facto research design and employs the Autoregressive Distributed Lag (ARDL) model to analyze both short-run and long-run relationships among the variables. Inflation rate is used as the dependent variable, while political instability and selected macroeconomic variables such as exchange rate, money supply, and interest rate serve as explanatory variables. The findings reveal that political instability exerts a significant positive effect on inflation in both the short run and long run, indicating that periods of heightened instability are associated with rising price levels. Additionally, exchange rate depreciation and increases in money supply were found to contribute significantly to inflationary pressures. The study concludes that political stability is crucial for achieving price stability and sustainable economic growth in Nigeria. It therefore recommends the strengthening of democratic institutions, consistent policy implementation, and improved governance frameworks to mitigate instability and control inflation.