spillover effect

The generator at the boys' quiz shop in Alaba spoils on a Tuesday morning, and by afternoon three other shops on the same street have lost customers too, because the whole corridor now smells of smoke and nobody wants to stay long enough to haggle over prices.

That is the spillover effect in its smallest, most local form. One person's problem refuses to stay put. It walks next door, then down the street, then sometimes across a border, because markets, people and countries are all connected by invisible pipes that carry both trouble and good news.

Zoom out to the whole economy and you see it clearly. When fuel prices rise in Nigeria because of a policy change, transport fares rise too, then food prices follow because farmers now pay more to move tomatoes from Benue to Lagos, then school fees calmly creep up because the school also pays more for its bus and its generator diesel. Nobody touched school fees directly, but the effect spilled over anyway.

It works across borders too. When the United States raises its interest rates, money that was sitting comfortably in Nigerian treasury bills starts packing its bags, because investors can now earn a safer return back home in dollars. The naira feels the pinch, forex reserves feel the pinch, and a decision made in Washington ends up changing the price of rice in Mile 12 market.

It is not always bad news either. A diaspora relative in the United Kingdom sending home ₦300,000 for a wedding does more than help one family. That money gets spent on aso ebi, on caterers, on a photographer, and each of those people spends it again elsewhere, so one remittance ripples gently through an entire local economy.

The lesson is humility. Economies are not sealed rooms. What happens in China, in Washington, or on one street in Alaba, rarely stays where it started.