An ARDL Bound Approach to the Nexus of Minimum Wage Increase and Economic Growth in Nigeria

  • Habiba Mohammed-Bello Umar Ibrahim Badamasi Babangida University, Lapai, Nigeria
  • Musa Abdullahi Sakanko University of Jos, Plateau State, Nigeria
  • Musa Salihu Ewugi Ibrahim Badamasi Babangida University, Lapai, Nigeria
  • Abubakar Alhaji Sadiq Ibrahim Badamasi Babangida University, Lapai, Nigeria
Keywords: Autoregressive Distributive Lag, Gross Domestic Product, Minimum, Wage, JEL Classification: C22, E01, E64, E24

Abstract

This study examined the impact of the national minimum wage on economic growth in Nigeria. The Autoregressive Distributed Lag (ARDL) model of econometric technique was employed to analyse the data, keeping GDP as the dependent variable and minimum wage as the independent variable. The study revealed that increment in minimum wage was positive and significant in both the long and short run to GDP, implying that an increase in minimum wage will raise the economic growth rate. Therefore, the three tiers of government and the private sector in Nigeria should implement and upgrade to the new National Minimum Wage of N30,000 to improve the income and capacity of low-skilled employees to enhance their economic growth.

Author Biographies

Habiba Mohammed-Bello Umar, Ibrahim Badamasi Babangida University, Lapai, Nigeria

Department of Economics, 

Musa Abdullahi Sakanko, University of Jos, Plateau State, Nigeria

Department of Economics, 

Musa Salihu Ewugi, Ibrahim Badamasi Babangida University, Lapai, Nigeria

Department of Economics, 

Abubakar Alhaji Sadiq, Ibrahim Badamasi Babangida University, Lapai, Nigeria

Department of Economics, 

Published
2022-07-14
Issue
Vol 7 Issue 1 (2022): LAFIA JOURNALS OF ECONOMICS AND MANAGEMENT SCIENCES
Section
Articles

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