Abstract:

The Nigerian informal economy is acknowledged to be one of the largest in the global economy, therefore, the dynamics of the informal economy should be central in the formulation of macroeconomic policies. However, evidence from the literature in Nigeria shows that there is little or no information pertaining to the cyclical characteristics of the Nigerian informal economy. Hence, this study attempts to document some of the business cycle facts of the Nigerian informal economy from 1992 to 2018 using the Hodrick-Prescott filter. The results from the analysis suggest that an expansion of the cycle of informal economy coincides with a rise in the level of unemployment and government interference.