Econometric Modelling of Symmetric and Threshold Effects of Fiscal Operations on Inflation in Nigeria

This study examines the symmetric and threshold effects of fiscal operations on inflation in Nigeria using annual data for the period 1981–2024. Specifically, it evaluates the effects of government revenue, public expenditure, fiscal balance, and public debt on inflation. Secondary data were obtained from the Central Bank of Nigeria (CBN) Statistical Bulletin and the World Bank database. The analysis employs the Autoregressive Distributed Lag (ARDL) model and threshold regression analysis to estimate both short- and long-run relationships. The findings indicate that government revenue, fiscal balance, and public debt exert significant inflationary effects in both the short and long run, whereas public expenditure has no significant short-run effect but reduces inflation in the long run. Threshold analysis further reveals that public expenditure becomes inflationary when it exceeds 14.56% of GDP, suggesting the existence of a fiscal threshold beyond which additional spending contributes to inflationary pressures.The results demonstrate that fiscal operations in Nigeria have heterogeneous rather than uniformly beneficial effects on inflation, emphasizing the importance of balancing revenue generation, public expenditure, and debt management. The study concludes that maintaining fiscal variables within sustainable thresholds is essential for preserving macroeconomic stability and supporting long-term economic growth. These findings provide useful evidence for policymakers seeking to improve fiscal management and strengthen inflation control in Nigeria.Copyright© 2026 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.Article’s History: Received 29th of April, 2026; Revised 9th of June, 2026; Accepted 22th of June, 2026; Available online: 30th of June, 2026. Published as research article in the Volume XXI, Summer, Issue 3(93), 2026.