Evaluation of the impact of customers' buying power on the sustainability of economic growth in Nigeria

Abstract

This study investigates the impact of customers' buying power on the sustainability of economic growth in Nigeria, focusing on identifying the factors influencing customers' buying power and their contribution to long-term economic stability. A descriptive survey research design was adopted for this study, which involved a population of 1,260 Nigerian consumers, with a sample of 378 respondents drawn from the South-South and South-East geopolitical zones. A stratified random sampling technique was used to ensure proportional representation across various income levels and sectors. The primary data collection instrument was the Evaluation of the Impact of Customers' Buying Power on the Sustainability of Economic Growth (EICBPSEGQ) questionnaire, comprising 14 items rated on a four-point Likert scale. Validity of the instrument was established through expert review, achieving a content validity index (CVI) of 1.00, while reliability was confirmed with Cronbach's Alpha coefficients of 0.94 and 0.96. Data were analyzed using descriptive statistics and standard deviation. The study revealed that customers' buying power plays a significant role in shaping economic growth and stability. Key findings indicated that inflation reduces spending ability, while exchange rate fluctuations impact the affordability of imported goods. Income inequality hinders economic participation, and government fiscal policies are critical in stabilizing the economy. Other factors, such as unemployment, political instability, and access to credit, also significantly affect customers' purchasing power. The findings underscore the collective importance of these factors in enhancing economic growth and maintaining long-term stability in Nigeria. To protect consumers' purchasing power, it is recommended that the government focus on stabilizing inflation through effective monetary and fiscal policies. This could include controlling the prices of essential goods and services, implementing measures to curb inflationary pressures, and managing the money supply to prevent excessive currency devaluation. By stabilizing inflation, consumers’ buying power can be maintained, which in turn will support sustainable economic growth.