Abstract
The study investigates impact of monetary policy on Nigeria's economic growth between 1970 and 2005. It adopts cointegration and error correction model. The gross domestic product is used as proxy for growth while bank rate, bank credit, monetary policy rate and exchange rate are used as monetary policy variables i.e the independent variables. The result shows that all the variables are integration of order one that is I(1). The cointegration result establishes a long run relationship between growth and monetary policy variables. The long run relationship further indicates that only the exchange rate has significant impact on the growth of Nigeria. However, the error correction model indicates that all the variables can jointly dictate the pace of Nigeria growth in terms maintain economic stability. It is recommended that policy makers to pay more attentions to monetary variables in their attempt to maintain economic stability.
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