A Vector Autoregression (VAR) Model of the Dynamic Interrelationships Between Gross Domestic Product and Selected Demographic Variables in Nigeria
DOI:
https://doi.org/10.33003/fjs-2026-1019-6199Keywords:
VAR, ADF, Lag Length, Granger Causality, Demographic Variables, GDPAbstract
This paper examined the dynamic interrelationship between gross domestic product and selected demographic variables in Nigeria using a vector autoregression (VAR) model to capture the temporal interactions among the variables employing annual time series secondary data covering the period 1995-2025 (30 years). Augmented dickey-fuller unit-root test was employed to test the stationary of the variables. Descriptive statistics was also employed to examine the distributional properties of the variables. The optimal lag selection criteria were used to determine the optimal lag of the study variables. The Granger causality analysis was employed to determine the causal relationship among the study variables. The results revealed that GDP and demographic variables showed dynamic interactions over time. The Granger causality analysis showed limited evidence that past values of the demographic variables simultaneously improve the estimation of GDP. The study concludes that demographic change alone cannot be enough to generate gross domestic product in Nigeria. We recommend that demographic factor should be considered alongside other economic factors when evaluating economic performance in Nigeria.
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Copyright (c) 2026 2Elizabeth Ishagba, Aniah- Betiang, Clement Vakang Tari, Mohammed Hamza, Gyegwe Fanyam, Salisu Isah
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