Macroeconomic Effects of Monetary and Fiscal Policy Interactions on Economic Growth Dynamics in Nigeria

Over the years, the Nigerian economy has been faced with continuous disequilibrium and complexity in policy direction that constitutes a major setback in the growth pattern and macroeconomic instability. In this regard, the paper investigated the effectiveness of fiscal-monetary policy interactions on real output growth in Nigeria between 1999 and 2016. The dynamic analyses of variables have been captured by the multiple least square estimators. The estimated findings reveal that both fiscal and monetary policies variables are effective in stimulating economic growth in the country. However, it was found that fiscal-monetary policy interactions have significant but negative impact on real GDP in Nigeria for the period considered. Thus, it seemed that in past there was no evidence of synergy between fiscal and monetary policies interactions in achieving economic growth in Nigeria. It is therefore recommended that, in order to put Nigerian economy on the path of sustainable growth, the government must co-ordinate fiscal and monetary policies and adopt a policy-mix that will promote growth and greater welfare of the citizenry