University Links: Home Page | Site Map
Covenant University Repository

Government Spending and Economic Growth in Nigeria: A VectorAutoregressive Modeling Approach

Abiola, Ashimiyu.G. and Orisadare, Monica. A. and Bowale, Ebenezer I.K (2010) Government Spending and Economic Growth in Nigeria: A VectorAutoregressive Modeling Approach. The Social and management scientists. ISSN 978-056-800-X

[img] PDF
Download (4MB)


This paper examined the impacts of capital and recurrent public expenditures on gross domestic product and also determined the causal relationships between government spending and gross domestic product in Nigeria between 1970 and 2002. The data was subjected to an econometric analysis using the vector autoregressive (VAR) modeling approach. The result shows that aggregate government expenditure generally rises with increases in oil revenue but hardly declines when the increases ceased, resulting in destabilization in the economy. Both recurrent and capital expenditure exerted positive impact on economic growth (GOP) but the impact of the capital expenditure was greater. Also the causality test showed that promoting economic growth had been largely responsible for the increasing government spending in Nigeria. The study recommended that the over dependency of Nigeria on the oil sector as its main source of revenue should be reviewed. Furthermore, it is recom~ended that a larger proportion of total government spending should be allocated to capital expenditure.

Item Type: Article
Uncontrolled Keywords: Government spending, Economic growth, vector autoregression
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic Theory
Divisions: Faculty of Law, Arts and Social Sciences > School of Social Sciences
Depositing User: AKINWUMI
Date Deposited: 05 Oct 2022 14:59
Last Modified: 05 Oct 2022 14:59

Actions (login required)

View Item View Item