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Oil Price Volatility and Macroeconomic Performance in Nonoil Exporting Countries in Sub-Saharan Africa

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  • Onyinye Maria David-Wayas

    (Department of Economics, University of Nigeria, Nigeria, Federal Inland Revenue, Abuja, Nigeria.)

  • Joseph I. Amuka

    (Department of Economics, University of Nigeria, Nigeria, Federal Inland Revenue, Abuja, Nigeria.)

  • Chukwudi F. Ezeudeka

    (Department of Economics, University of Nigeria, Nigeria, Federal Inland Revenue, Abuja, Nigeria.)

  • Iyenge Mhir Aii

    (Department of Economics, University of Nigeria, Nigeria, Federal Inland Revenue, Abuja, Nigeria.)

  • Micheal C. Nwankwo

    (Department of Economics, University of Nigeria, Nigeria, Federal Inland Revenue, Abuja, Nigeria.)

Abstract

This paper examines the impact of oil price volatility on macroeconomic performance in fourteen non-oil exporting Sub-Saharan Africa (SSA) economies using panel ARDL model fort he 1980-2015. It also looks at the channels through which oil price volatility transmit to the three major sectors of their economies. The panel ARDL estimate indicates how persistent oil price volatility prevailed on the economy by measuring the short run and long run effects. The result shows that economic activity and sectors, respond very differently to oil price volatility depending on the time period whether short term or long term. In particular, oil price volatility has a negative effect on the macroeconomy in the short run but the effect becomes positive in the long run. The result also indicates that oil price volatility dampens the agricultural sector but improves the activities in the manufacturing and services sectors. The results further show that oil price volatility affects the exchange rate and interest rate channels negatively but positively through the inflation channel. The paper therefore shed some light on how the policy makers of these economies can use controlling mechanisms to stabilise the macroeconomy, key sectors and the transmission channels.

Suggested Citation

  • Onyinye Maria David-Wayas & Joseph I. Amuka & Chukwudi F. Ezeudeka & Iyenge Mhir Aii & Micheal C. Nwankwo, 2021. "Oil Price Volatility and Macroeconomic Performance in Nonoil Exporting Countries in Sub-Saharan Africa," International Journal of Energy Economics and Policy, Econjournals, vol. 11(3), pages 221-230.
    • Handle: RePEc:eco:journ2:2021-03-27
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    References listed on IDEAS

    as
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    Cited by:

    1. Chang, Lei & Baloch, Zulfiqar Ali & Saydaliev, Hayot Berk & Hyder, Mansoor & Dilanchiev, Azer, 2022. "Testing oil price volatility during Covid-19: Global economic impact," Resources Policy, Elsevier, vol. 78(C).

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    More about this item

    Keywords

    Oil price volatility; macroeconomic performance; sectors; transmission channels; non-oil exporting; SSA; panel ARDL.;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics

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