AN ANALYSIS OF INFLATION ON THE ECONOMY OF EDO STATE (EDUCATION PROJECT TOPICS AND MATERIALS)
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
Inflation can be defined as persistent rise or increase in the general level of price. Inflation is an economic situation whereby so much money is chasing few goods. It is a problem which affects every country of the world especially developing countries like Nigeria which goes a long way to affecting the states. Inflation is the most serious problem prevailing I our economy today, which seems to be assuming an economic epidemic dimension. As everybody is struggling to survive, prices of goods and services are at a rapid alarming rate of increase. The historical perspective of inflation can be narrowed down to the 1950s and 1960s. a decade before this period was the general inflationary period in the world. It was at its peak in the 1960s when the Nigeria civil war ended as all the resources of the nation were diverted towards the production of arms and ammunitions (weapons of war). Able bodied men who would have engaged in farming were as a result of this, the agricultural sector of the economy suffered, thus the few available goods were distributed in favor of those in the upper class.
The product of this was unemployment that starved thousands of youths since industries were shut down. There was a considerable increaser in government expenditure which was not equated with taxation as many of the working age were unemployed. Consequently, government had to pay a large part of the expenses by minting (creating/printing) more money and borrowing from banks. Thus the volume of money in circulation increased without no corresponding increase in goods and services. We all now feel the bite since food and non-food items have continued to increase, some consumers notable the poor feel the effect most. Most households in Edo State are made up of low income earners who have to contend with the continuing inflationary trend. Hence, there is need to study and provide a pragmatic solution from the basis of this research.
