Dynamic interaction of Inflation Determinants and Unemployment in Nigeria: Atheoretic Model

Inflation and unemployment are some of the key macroeconomic issues with constant policy measures to tackle the macroeconomic issues. The study, explore the nexus between unemployment and inflation determinants in Nigeria. The nexus covers the period of 1990 to 2024. The specific objectives are to examine the dynamic interaction of the identified inflation determinant (Consumers spending, government spending and interest rate) and unemployment. The study specified atheoeretic model of vector auto regressive (VAR) as a suitable model to determine the dynamic interactions. The result reveals the varying interactive level of inflation determinants and unemployment In addition the impulse response function was also conducted to identify the shocks pattern in the system as well as the impulse response function findings shows that all the determinants of inflation has positive nexus with unemployment in Nigeria From the findings therefore the study recommends for caution an control of inflation factors to cushion unemployment in Nigeria.