This study has two objectives. First, it incorporates income and expenditure accounts into the Nigerian economy’s production structures. Second, it conducts an impact analysis on the nexus of income and expenditure to examine the economic impact of reduced cocoa bean exports during COVID-19.
The study employs an extended multisectoral model (EMM) on a social accounting matrix (SAM) to incorporate the income and expenditure of the institutional sectors into the production structures. Later, the study identifies key commodities using linkage analysis. Furthermore, the study empirically investigated the economic impact of cocoa bean export reduction amid COVID-19.
The findings posit that “motor vehicles and assembly,” “construction,” “transport; road, water and rail,” and “financial institutions” remain key commodities in the exogenous and endogenous income-expenditure setups, underlining their significance in the economy. However, commodities such as “cassava unprocessed,” “oil refining,” “fertilizers and chemical products,” “plastic and rubber products” and “broadcasting,” which were key in the exogenous setup, do not retain their dominance in the endogenous setup. On the other hand, the impact analysis finds a decline in GDP, household consumption, public expenditure, and aggregate investments by 0.892%, 0.884%, 0.824% and 0.902% respectively.
A major limitation of this study is the reliance on the 2010 SAM, which, although it captures fundamental structural linkages, may not fully reflect recent economic changes. Building and upgrading the SAM using more current data would reveal more robust and sectoral dynamics in future studies. Another limitation is that the current study is static. Future studies can calibrate dynamic input-output or computable general equilibrium models for more insightful findings.
The originality and value of this approach lie in its integrated strategy to economic recovery, combining targeted policy interventions, public–private partnerships and data-driven decision-making. By focusing on key commodities like motor vehicles, assembly and infrastructure, it ensures efficient resource allocation. Using an EMM on a SAM highlights the importance of evidence-based policymaking tailored to specific challenges. Encouraging export diversification and innovation in commodities like processed cassava creates new growth opportunities, reducing reliance on traditional commodities and enhancing economic stability.
