Political Risk, Energy Supply, and Manufacturing Performance in Nigeria: A Bayesian ARDL Analysis of Internet Search Behaviour and Traditional Macroeconomic Indicators

By: Mustapha Hussaini & Nura Aliyu Kabuga

Pages: 81–98, Volume: 3, Number: 2

Published by: AEFUNAI Journal of Economics, Finance and Development Studies, Alex Ekwueme Federal University, Ndufu-Alike, 8/1/2026, 2026

ISSN (Electronic): 2536-6742

DOI:

Political Risk, Energy Supply, and Manufacturing Performance in Nigeria: A Bayesian ARDL Analysis of Internet Search Behaviour and Traditional Macroeconomic Indicators

Abstract:

This paper investigates both the long and short-run effects of political risk, energy availability, and traditional macroeconomic indicators on manufacturing performance in Nigeria using monthly data from January 2010 to December 2025. The relationships are estimated using a Bayesian Error Correction Autoregressive Distributed Lag (ECM–ARDL) model, which provides probabilistic inference through posterior distributions and credible intervals. The findings indicate that energy availability is the strongest positive determinant of manufacturing performance, providing decisive posterior evidence that reliable electricity supply enhances industrial productivity. In contrast, political risk and exchange rate depreciation exert persistent negative effects on manufacturing performance, while inflation, oil prices, and monetary policy exhibit comparatively weaker posterior evidence after accounting for structural and institutional factors. The Bayesian results further revealed a slow adjustment towards long-run equilibrium, suggesting that shocks to Nigeria’s manufacturing sector are highly persistent. Methodologically, the study demonstrates the value of integrating internet search behaviour with Bayesian econometric modelling to capture evolving political uncertainty. The findings suggest that sustainable manufacturing growth requires coordinated improvements in electricity reliability, political stability and macroeconomic management, providing important evidence for industrial policy and manufacturing development in Nigeria and other developing economies.

Keywords: Bayesian ECM–ARDL, Energy Availability, Internet, Manufacturing performance, Nigeria, Political risk