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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:Sectoral price effects of liberalizing Nigerian PE prices: 1974-78
Author:Ajakaiye, D. Olu
Periodical:The Nigerian Journal of Economic and Social Studies
Geographic term:Nigeria
public sector
Abstract:In Nigeria production and pricing policies of the major public enterprises (PEs) are subject to government controls. However the impact of such controls on the national economy is rarely assessed. To this end, the author presents a framework for assessing the impact of PE subsidies on sectoral prices. It is used to measure the sectoral price effects of pursuing cost-recovery pricing policy in the PEs, thereby eliminating the operating losses of these PEs that were recorded during the period 1974-1978. The analysis of the results shows that had the major PEs pursued cost-recovery pricing policy at the beginning of every year between 1974 and 1978, the inflationary pressure in the economy would have been exacerbated and the real income distribution adversely affected. But it probably would have helped reduce the vulnerability of the national economy to external shocks by abating increases in demands for most goods with the consequent positive effects of this on the balance of payments. Notes, ref.