Real Exchange Rate and Manufacturing Performance in Nigeria

The efficacy of currency devaluation to improve output in Nigeria is under debate, and coupled with an unsatisfactory result the behaviour manufacturing sector performance regenerated interest this study investigate impact exchange rate on employment sector. work uses Structural Vector Autoregression, ECM Canonical Co-integrating Regression examine shock effect, short long-run elasticities performance. While are used as a proxy for findings show that changes fairly elastic both long-run. However, insignificant run. variance decomposition form SVAR shows forecast error more prolong than output. Consequently, estimation Impulse Response Function from Monte Carlos one standard deviation adversely affect employment. outcome indicates Nigerian has not improved Several factors may be accounted this, although, it due cost-push inflationary pressure unfavourable competitiveness. suggests need encourage long-term supply-side policies among others situation.
 
 Received: 7 June 2020 / Accepted: 9 January 2021 Published: 5 March