The Relationship between Government Expenditure, Economic Growth and Poverty Reduction in Nigeria

Abstract

This study examines the relationship between government expenditure, economic growth and poverty reduction in Nigeria using time series data over the period 1980-2013. Employing modern time series econometric techniques such as unit root tests, bound test co-integration approach and error correction techniques within an ARDL framework which yields more robust estimates.It is found that government spending affect  economic growth positively and significantly by increasing real  private investment and fixed capital accumulation  which increase capital accumulation,  reduction  in current  account  deficit,  external  debt  burden  and  improve  education/skills of  the households by improving human capital. Findings emerge from this study that government expenditure has significant short run impact on poverty reductions in its lag form in which it might be examined by the role of fiscal policy in alleviating poverty of current year in Nigeria.The study suggested policies the role of government should be extended to ensure the magnitude and the quality of private investment as high as possible.

Keywords: ARDL Analysis, Government Expenditure, Poverty Reduction, economic growth


Article Review Status: Published

Pages: 1-10 (Download PDF)

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