Public Expenditure, Official Development Assistant and Economic Growth: A Time Series Analysis for Nigeria (1981 – 2018) (Published)
In addition to divergent views of economists on the effect of public expenditure on economic growth, results of existing empirical studies in developed and developing economies has remained inconclusive and tends to depend on the period of study, econometric method, nature of data and the composition of government expenditure. In this study, public expenditure in Nigeria is decomposed into domestic and the foreign receipts components. The domestic component comprises capital expenditure (GCE) and recurrent expenditure (GRE) while the foreign receipts component captures foreign inflow of official development assistance (ODA). Employing extended aggregate production function framework and bound test approach (ARDL model), this study examined the impact of each of these three components of public expenditure (GCE, GRE and ODA) on economic growth in Nigeria for the period (1981- 2018). The findings of this study indicate the existence of a long run relationship between the macroeconomic variables estimated in the model. The recurrent expenditure (GRE) has positive impact on economic growth both in the short-run and in the long-run, countering the widely held view that government consumption spending is growth-reducing. The capital expenditure (GCE) and official development assistance (ODA) have negative impact on economic growth in Nigeria both in the short-run and long-run. The granger causality test result shows no causal relationship between GDP and GCE and between GDP and ODA, but a bi-directional causal relationship exists between GDP and GRE. It is recommended that greater percentage of public fund should be expended as capital expenditure and such fund should be properly utilized on acquisition of physical capital and social overhead capital like transportation, electricity, communication, irrigation, flood control, research and human capital development, capital formation in agricultural and industrial sectors to enhance the productive capacity of the economy. ODA in recent times has been unreliable source of finance in Less Developed countries, hence Nigeria should not heavily depend on it. However, whatever ODA is received should be properly utilized and channel into productive projects which have significant positive impact on economic activities and wellbeing of the populace. The fight against corruption in the country should be frontally confronted to free more public fund for collective development purposes in the country.
Keywords: Capital Expenditure, Nigeria, Official Development Assistance, Public expenditure, Recurrent Expenditure, economic growth
Trade Openness, Human Capital Investment and Economic Growth in Nigeria (Published)
The study examined the impact of trade openness and human capital investment on economic growth in Nigeria from 1981 to 2020 and employed error correction mechanism for the analysis. Economic growth was proxied by nominal gross domestic product. Human capital investment was decomposed into government capital expenditure on education, government recurrent expenditure on education, government capital expenditure on health and government recurrent expenditure on health while trade openness was measured by trade openness index. Exchange rate was used as check variable. The study carried out descriptive statistics test, Augmented Dickey-Fuller unit root test, Johansen co-integration test and Error Correction Mechanism (ECM) technique for the analysis. The result revealed that capital component of government expenditure on health and education were negatively related to national output during the period of investigation. However, the recurrent component of government on both health and education as well as trade openness were positively related to economic growth for the period. The study recommended among others that Government should increase funding in education and health sectors to meet the 20% to 15% benchmark recommended by UNESCO and WHO respectively and adopt the private sector model of payment that is based on milestone achieved in capital projects in both sectors.
Citation: Timothy Kabari Kerebana and Itode James Krama (2021) Trade Openness, Human Capital Investment and Economic Growth in Nigeria, International Journal of Development and Economic Sustainability, Vol.9, No.3, pp.57-71
Keywords: Human Capital Investment, economic growth, trade openness
Fiscal Deficit and External Debt: The Nigerian Experience (Published)
This study seeks to ascertain the impact of fiscal deficit on external debt in Nigeria with a focus on determining the long run relationship between fiscal deficit and external debt, as well as to ascertain the direction of causality between fiscal deficit and external debt. The model employed in this study is the Error Correction Mechanism; Granger causality test was used to ascertain the direction of causality. The time frame for this study spanned between the years 1981-2019. This study found that fiscal deficit is not a significant determinant of external debt in Nigeria. Also, the variables of gross domestic product, degree of openness, exchange rate was found to be insignificant factors determining external debt except inflation which was significant in determining external debt in Nigeria. Furthermore, there was neither a uni-directional nor bi-directional causality between external debt and fiscal deficit. Although, there is causality flowing from budget deficit and degree of openness as well as budget deficit and gross domestic product. However, it was suggested that policies be implemented that will enhance the channeling of funds from the external sector to productive sectors of the economy in order to ensure diversification and revenue generation thereby ultimately lessening the external debt burden that Nigeria is faced with. Finally, there is need for fiscal discipline and fiscal prudence if fiscal deficits would be a true determinant of the size of external debt accumulated in the country.
Citation: Shofade Oladapo Daniel and Kazeem Adebola Ibrahim (2021) Fiscal Deficit and External Debt: The Nigerian Experience, International Journal of Development and Economic Sustainability, Vol.9, No.3, pp.1-18
Keywords: Budget, External Debt, Fiscal Policy, economic growth, fiscal deficit
Effect of Vegetable Exports on Nigeria’s Economy (Published)
Nigeria’s heavy dependence on crude oil has rendered its economy vulnerable to fluctuations in world crude prices hence the intense prospect for exportation of cultivable vegetables to the global market in pursuant to the compelling need for Nigeria to diversify its economy. This study investigates the effect of vegetable exports on Nigeria’s economy from 1988 to 2018 with the new growth theory as its theoretical framework. Time series data were sourced from World Integrated Trade Solution (WITS), World Development Indication (WDI) and Central Bank of Nigeria (CBN) Statistical bulletin. The autoregressive distributive lag (ARDL) bounds testing technique and the error correction model were adopted for the study. Our results show that although the coefficient for vegetable exports was negative, it significantly impacted on Nigeria’s economic growth. More so, total agricultural exports had positive impact on economic growth. On this basis, we recommend that Nigeria should revisit its exports composition and pattern regarding all vegetable products and provide quality inputs so as to improve the quality and consistency in supply of vegetable exportables to the world market.
Citation: Ebele S. Nwokoye, Ekwutosi V. Ojukwu, Christopher U. Kalu, Amaka G. Metu (2021) Effect of Vegetable Exports on Nigeria’s Economy, International Journal of Development and Economic Sustainability, Vol.9, No.2, pp.23-38,
Keywords: Agricultural Export, economic growth, vegetable exports
A Cointegration Analysis Of Economic Growth And Co2 Emissions: Case Study On Malaysia (Published)
The paper aims to establish a long-run and causal relationship between economic growth, CO2 emissions, international trade, energy consumption, and population density in Malaysia. The study will use annual data from 1970 to 2014. A unique cointegrating relationship between our variables was identified, and the Environmental Kuznets Curve (EKC) hypothesis was analyzed using the Auto Regressive Distributed Lag (ARDL) methodology. Our empirical results suggest the existence of a long-run relationship between per capita CO2 emissions and our explanatory variables. The Vector Error Correction Model (VECM) methodology was used to analyze the Granger Causality, and the results show the absence of causality between CO2 emissions and economic growth in the short-run while demonstrating uni-directional causality from economic growth to CO2 emissions in the long-run.
Keywords: CO2 emissions (dependent variable), Environmental Kuznets Curve (EKC) Auto-Regressive Distributed Lag (ARDL), economic growth
Foreign Direct Investment, Portfolio Flows and Economic Growth in Nigeria (Published)
This research focuses on the impact of Foreign Direct Investment and Portfolio Flows on Economic growth in Nigeria. The research covers the period between 1980 and 2018. Secondary data were collected from the Central Bank of Nigeria statistical bulletin and various issues of World Bank Publications as well as Nigerian Bureau of Statistics (NBS) The period being understudied encompasses the period of massive government efforts to attract foreign investors into the country as well as period of turbulent macroeconomic indicators such as high unemployment and low level of per capita income in Nigeria. The parsimonious Error Correction Modelling (ECM) result shows that Foreign Direct Investment, Foreign Portfolio Investment, Labour force and Gross Fixed Capital Formation have a positive and significant impact on the level of Economic Growth in Nigeria. The Johanson cointegration test result shows a long-run relationship among Foreign Direct Investment, Foreign Portfolio Investment, Labour Force, Gross Fixed Capital Formation in Nigeria. The result from the variance decomposition reveals that shocks to Foreign Direct Investment, Foreign Portfolio Investment, and Labour Force and Gross Fixed Capital formation did not explain a significant proportion of the changes in economic growth in Nigeria within the period of the study. It was recommended that government should put in place policies to encourage foreign investors to go into the agricultural and manufacturing sectors which are key to job creation and for sustainable economic growth.
Keywords: Capital Flight, co-integrating relationship, economic growth, non-stationary variables, parsimonious model.
Effect of External Debt on Nigerian Economy, 1994-2015 (Published)
The study set out to investigate the effect of external debt on Nigerian economy. Time series data for twenty-two years that span from 1994 to 2015 were obtained and subjected to test using Ordinary least square regression (OLS) for the hypotheses formulated for the study. The study revealed some forms of long run relationship between Gross domestic product, on the one part and external debt, external debt service and export, on the other part but of particular importance is the long run marginal negative relationship between external debt and Gross domestic product. The study further confirmed causality, from predictors to dependent variable and recommended that there should be a ban on external debt in Nigeria, for some time. However, where external debt is unavoidably necessary for productive venture/investment that can boost export, it should be for such specific venture/investment and should be well managed to pay back the external debt and its associated service cost, thereby justifying the decision for such external debt without further stress on the economy.
Keywords: External Debt, economic growth, external debt service, value of export
Education and Economic Growth in South Asia (Published)
Interconnection between education and economic growth is a subject of great interest in most developing nations in the world today. This is because economic growth is one of the key indicators of the level of national development. In this study, regression analysis is applied to look into the genuine effects and the relationship between education and economic growth of the Southern Asian Countries such as Bangladesh, India, Nepal, Pakistan, Maldives, Bhutan and Sri Lanka. The methodology consists of the means of estimation and econometric analysis which help to determine the actual quantitative effects of education in economic growth especially in South Asian nations. By this, an affirmation of the relationship between the two variables can be made due to enough evidence obtained in this study.
Keywords: Education, GDP, Regression, South Asia, economic growth
Tertiary School Enrolment in Nigeria: Implication for National Development (Published)
The paper evaluates tertiary school enrolment in Nigeria: Implication for national development. The main aim of the paper is to assess the effect of tertiary school enrolment on economic growth in Nigeria. It is equally discovered that while tertiary enrolment is nominally increasing, in real terms, it is abysmally nose-diving. The analyses used for the study include the Ordinary Least Square estimation techniques, unit root test, co-integration test and the variance decomposition test to analyze the empirical model of the study. The findings of the empirical investigation confirm that tertiary enrolment is veritable tools through which appreciable economic growth can be enhanced in Nigeria. The study equally observed that tertiary school enrolment and government recurrent expenditures are statistically significant in explaining growth in the Nigerian economy. The paper therefore recommends among others that government should as a matter of urgency give immediate employment to all NCE graduate, this will encourage and increase the number of people seeking enrolment in the colleges
Keywords: Government Expenditure, National Development, capital expenditures, economic growth, recurrent expenditures, tertiary enrolment
Higher Institutions Funding and the Nigerian Economy (Published)
This study examines funding tertiary institutions and Nigerian growth perspective. The specific objective of the study is to evaluate the effect of tertiary institutions funding on national development in Nigeria. An ordinary least squares estimation technique was used in the study to evaluate the effect of the independent variables on the dependent variable. The result of experiment indicates that funding is a veritable tool for tertiary institutions growth in Nigeria. The result also shows that government capital expenditure funding is not statistically significant in the growth process. It was recommends that the government has to invest more on the education sector as well as ensuring that the resources are properly managed and used for the development of education services. The study concludes that funding of higher education in Nigeria needs to be improved upon especially in the area of capital expenditures funding. This is as a result of the increasing need and demand for specialized services in different sectors within the academic institutions.
Keywords: Budget, Education, Funding, Government Expenditure, Higher Institutions, economic growth