Udoffia and Godson
Greener Journal of Social Sciences Vol. 6 (4), pp. 092-105, November 2016
ISSN: 2276-7800 © 2016 Greener Journals
Manuscript Number: 110116199
The Impact of Federal Government Expenditure on Economic Growth in Nigeria (1981-2014)
*Udoffia David Thompson, Godson Juliet Rita
Department of Economics, University of Uyo, Nigeria.
The study investigated the impact of federal government expenditure on the Nigerian economic growth. The main objective of the study was to ascertain whether there is a relationship between federal government expenditure and economic growth in Nigeria. The study adopted the Ordinary Least Square estimation technique to estimate the model specified using time series data for the period 1981-2014. Real Gross Domestic Product was used as the dependent variable while federal government capital and recurrent expenditures were used as the independent variables. The result from the regression analysis shows that federal government capital and recurrent expenditures have a positive effect on real GDP. The data used in the analysis were gotten from Central Bank of Nigeria (CBN) statistical bulletin. The study recommended that federal government should direct more of its recurrent expenditure towards economic and community services as they accelerate economic growth. The study also recommended proper management of public funds allocated to the agricultural sector and manufacturing industries as they have the potential of raising the nation’s production capacity and providing employment for citizens in the country.
Keywords: Recurrent Expenditure, Capital Expenditure, Gross Domestic product, Economic growth, impact.
Agbonkhese, A. O. and Asekhome, M. O. (2014). Impact of Public Expenditure on the Growth of Nigerian Economy. European Scientific Journal, 10(28), 219-227.
Akpan, U. F. and Abang, D. E. (2013). Does Government Spending Spur Economic Growth? Evidence from Nigeria. Journal of Studies in the Social Sciences. 5(1), 36-49.
Awomuse, B. O., Olorunleke, K. and Alimi, R. S. (2013). The effect of federal government size on economic growth in Nigeria, 1961-2011. Munich Personal RePEc Archive (MPRA). 1-12
Central Bank of Nigeria Statistical Bulletin. (2014). 25, 77-79.
Chude, N. P. and Chude, D. I. (2013). Impact of Government Expenditure On Economic Growth in Nigeria. International Journal of Business and Management Review. 1(4): 64-71.
Egbetunde, T. and Fasanya, I. O. (2013). Public Expenditure and Economic Growth in Nigeria: Evidence from Auto-Regressive Distributed Lag Specification. Zagreb International Review of Economics & Business. 16(1), 79-92.
Emerenini, F. M. and Okezie, A. I. (2014). Nigeria’s Total Expenditure: Its Relationship with Economic Growth (1980-2012). Mediterranean Journal of Social Sciences. 5(17), 67-74.
Njoku, C. O., Ugwu, K. E., and Chigbu, E. E, (2014). Government Public Expenditures: Effect on Economic Growth (The Case of Nigeria, 1961- 2013). International Journal of Research in Management, Science and Technology. 2(1), 16-29.
Okoro, A. S. (2013). Government Spending and Economic Growth in Nigeria (1980-2011). Global Journal of Management and Business Economics and Commerce. 13(5), 21-29.
Onakoya, A. B, and Somoye, R. O., (2013). Impact of Public Capital Expenditure on Economic Growth in Nigeria. Global Journal of Economics and Finance. 2(1), 1-11.
Shuaib, J. M, Augustine, O. E. and Frank, A. O., (2015). Balance of Payments: Nigerian Experience: 1960-2012.British Journal of Economics, Management and Trade. 4(7), 296-305.
Stefan, F. and Magnus H. (2001). Growth Effects of Government Expenditure and Taxation in Rich Countries. European Economic Review. 45(8), 1-18.
Taiwo, M. and Abayomi T., (2013). Government Expenditure and Economic Development: Empirical Evidence from Nigeria. Munich Personal RePEc Archive. 37293.
World Development Indicators, (2014). The World Bank. 21.