PREFACE
Having looked at the present
trend in the Nigerian economy it is very obvious that price of items has
continued to raise especially food related items.
A special reference will be on the impact of inflation in
income and wealth distribution of the nation (A case study of Enugu state)
The work is divided into five chapters one focused on the introduction and
definition of the problem presented by the study chapter two dwelt on the
review of related literature.
Chapter three is all about research design and methodology formed of the
research work.
Chapter analysis of data as well as
testing of hypothesis while the summary of findings, recommendations and
conclusion were death with in chapter five
TABLE OF
CONTENTS
Title page
Approval
Dedication.
Acknowledgment
Preface.
Table contents
CHAPTER ONE
INTRODUCTION
1.0 Background
of study.
1.1 Statements
of problem.
1.1 Objective of the study.
1.2 Significance of the study
1.3 Hypotheses
1.4 Scope and limitation of the study
CHAPTER TWO
2.0
Review of literature
2.1
Meaning of inflation
2.2
Types/causes of inflation
2.3
Peryas, Veness of inflation
2.4
Brief history on world inflation
2.5
Brief history on Nigeria inflation
2.6
Inflation and economic development
2.7
Effects of inflation on savings
2.81 Effects of inflation on exports
2.82 Effect of inflation on import.
CHAPTER THREE
RESEARCH
DESIGN AND METHODOLOGY
3.0
Source of data
3.1 Secondary
of data
3.1.2 Questionnaire
design
3.1.3 Sample size
determination
3.2
Methods of investigation
3.3
Method of
questionnaire distribution
CHAPTER FOUR
4.0 PRESENTATION
AND ANALYSIS OF DATA
CHAPTER FIVE
5.0 Summary of findings
recommendations, conclusions and areas of further research
5.1
Summary of findings
5.2
Recommendations
5.3
Conclusions
5.4
Areas of
further research.
CHAPTER ONE
INTROUDCTION
1.1 BACKGROUND
OF STUDY
Inflation is neither new in
the economic system of Nigeria
nor the world at large. Variations in
magnitude or rates have been noticed to be in existence.
In Nigeria
the rate of inflation was about 10 percent between 1969 and 1970. Prices rose
by about 14 percent in 1970 (immediately after the civil war of 1970). Then fell to 3 percent in 1972. Rose by about
16.1 percent in 1974 and reached a rate of about 34 percent increase in 1975.
In the
80’s, the rate of inflation between 1908 and1982 was around 30 percent with the
rest of the 80’s at the rate of 40% averagely.
The 90’s
were at the rate of 40 to 50% between 1990 to 1992 and then 1994 rate was
officially put at above 60 percent.
Inflation was and is still the greatest task to government’s
policymakers in the 1990’s.
In the
world, between 1979-1801, prices rose by more then 50 percent. Also between
1939-1941, the prices level was record to be almost what it was before.
The height
of Herry V111’s debasement in England (through the mint reducing the weight of remitted
coins, lowering their gold and silver content, and increasing the normal value
of existing coins by assigning them higher values as well as melting down plate
and ornament taken from the ransacked monasteries), and prices between many
1542 and mid 1551, had an inflationary rate of 16 percent per annum 23 percent
during war with France and almost 30 percent during the first world war. This is about the highest rate attained in
the world history.
It is now
evident that inflation persists both in the developed and developing countries,
with difference in magnitude or rates.
The rate is developed countries making comparison with present
situations, as the above noted rates were attained during the seventeenth
century and the early part of the eighteenth century (1799-1801), and the early
to mid parts of the nineteenth century (1939-1951).
In the case
of Nigeria,
the rates were attained in the rate nineteenth century (1969-1975).
Inflation
simply refer to a continuous or in ---- rise in prices.
According
to Webster’s seventh new collegiate dictionary, inflation is defined as an
increase in the volume of money and credit relative to available good resulting
in a substantial and continuous rise in the general price level. This definition points out the fact that
inflation cannot occur unless there is undue increase in the volume of money
and credit. This brings about continued
rise in general price level of goods, which in not being matched by the
proportionate quality of goods and service in the economy.
Inflation
become significant in Nigeria
after the Nigeria
civil war thought it might have been in existence long before then.
Immediately
after the Nigeria
civil war, prices took an upward turn from their previous level due to the
shortage of goods and services, caused by the disruption of productive factors
by the civil war.
Furthermore,
the caused factor of salaries and wages review should not be left
unmentioned. The review started with the
Adhoc Award of 1970 which was followed by the Udoji and William Awards of
1974. all these awards intensified the
inflationary pressure.
Also, the
high prices if imported goods arising from increases in foreign prices and
instability of international exchange rates.
Surcharge from post congestion, storage facilities, marketing
arrangements plus the distribution new work.
The issue
of gradual remove of the remaining 20 percent on oil subsidy is the most
current inflationary element in the Nigeria economic system.
If
inflation were to every one in exactly the same way and degree, it would have
no importance what so ever. It’s social
significance arises from the fact that it always does affect people
differently. It’s effect on have wife
(A) would differ from it’s effect on house wife B depending on personality
income and family. Whether in village or town are of relevance to the study.
1.2 STATEMENT OF PROBLEM
The
inflationary period is a time of high prices of goods and services this lowers
the quantity and type of products (goods and services) purchasable by the
messes in Enugu
state at any point in time. The problem posed is that Enugu dwellers others in the society are
unable to purchase types (quality) and quantities of desired products during
inflation.
During
inflation, income (especially of those fixed income earners and the very poor
ones in the society) are unable to match the increasing prices of goods and
service. This continues as long as
rising prices and falling purchasing power persists. The problem as the ability of masses to
purchase products†in the light of continued rising prices become reduced.
Equally of
importance is the issue of inflation giving rise to the different societal
classes, thereby creating gaps in the society with income as the distinctive
factor. There is a high gap between
incomes of fixed incomes earners and the profit earners. This is because the profit earners incomes
tend to rise with the rising price of products as opposed to those of the fixed
income earners.
It is also
worth while to note that during an inflationary period, saving decline. This is because a decline in savings results
in low investment, whereas low investment retards economic growth.
The
pertinent questions to ask here is how will the masses be able to purchase the
desire mix of products. How will the
fixed income earners be able to maintain their standard of living at periods pf
continued rising prices? How do poor masses make both ends meet under a situation
of declining purchasing power?
How will
the government bridge the gap between the fixed income earners and profit
earners?
1.3 OBJECTIVES OF THE STUDY
The
objective of the researcher is
1.
To how inflation affect the income of average
individual living in Enugu
metro list
2.
To find out low the negative effect of inflation on income
can be corrected or averted.
3.
To identify the class of workers that inflation affect most
1.4 SIGNIFICANCE OF THE STUDY
The
importance of this study lies in the fact that an analysis of the meaning,
cause/ types and effect of inflation on the masses (a market segment of the
heterogeneous population) etc, will give a more realistic out look of how the
total market segments (the population as whole) are being affected.
It is hoped
that a stud of this nature will.
1. Expose the sufferings of the masses
through its finding to policy makers for formulation and belting pf life for
every citizen.
2. Help marketer in the planning of the
marketing mix for their products
4.
Assist the planning units of the government through
the provision of more efficient feedback information on the effectiveness of
their anti inflation policies
1.5 HYPOTHESES
H0- inflation affects the income of average
individual living in Enugu
metropolis
H1- Inflation does not affect income of average
individual living in Enugu
Metropolis.
1.5 SCOPE OF
THE STUDY
Enugu, Onitsha and Awuzu localities were defined by
the research to cover the occupational sectors of individuals within these
localities this was grouped into five,
1.
Group A. masses in the parastatals of the public sector
2.
Group B. masses that are self employed
3.
Group C. masses that are civil service
4.
Group D. masses in the private sector
5.
Group E. other masses and student house wives
The
grouping was on the basis of relative uniform income among the masses in the
same sector and also for case of questionnaire administration and control. Also, the use of occupational basis will aid
in the easy determination of which classes individuals suffer most under an
inflationary situation.
Furthermore,
the locality that has its masses mostly affected will be easily detected, using
the same occupational variable as basses for comparison.
The sample
space comprised those in the public and private corporations, self- employed,
retire (pensioners) ordinary masses (non income earners) and student that are
married, with or without children.
LIMITATIONS
Research works are subject to one form of limitation or
other. Mine is not an exception it was
the initial though of the researcher that the exercise was going to be easy and
smooth, but the contrary was the case
As a
student, several academic demand compete for the limited but precious time
available. This implies that non of
these competing exercise could be effectively handled without the other being
worse off. That was my situation.
Although the time expended was too small to do Justice to the study, the
opportunity cost in terms of other equally important activities forgone or
cursorily attended to was much.
At this
period or general economic crunch where the cost of every thing is high
carrying out a study and all that it involves in the three localities (Enugu, Onitsha,
and Awuzu) is much more that a student could bear with his meager purse.
The
researcher faced some embarrassments arising from the impatience, too much busy
and uncompromising attitude of respondents, even when the study is supposed to
encourage ready co-operation from the house wives. It was however, with convincing tact that I
manage to make through this obstacle after many journeys to Onitsha and Awuzu localities.
Inclusively,
was the problem of inadequate data and previous works of relevance to the study
secondary data were manly peripheral while previous works were completely
unrelated to the issue at State?
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