Rethinking the effectiveness of fiscal allocation strategy: A focus on economic development in Nigeria (Published)
This paper developed and estimated two autoregressive distributed lag (ARDL) models to explore the empirical relationship between fiscal policy allocation strategies and economic development in Nigeria. Specifically, the impacts of public expenditures on social and community services, economic services and administration on poverty headcount and income inequality were examined between 1990 and 2017. The unit root test results show that the variables are mixed integrated. The ARDL bounds test results revealed that long run relationship exists among the variables in each of the models. The ARDL estimates reveal that public capital expenditure on economic services in addition to expenditure on social and economic services have significant positive impact on poverty headcount in the short run. The result further indicates that expenditure on administration negatively influenced the poverty level. More so, expenditure on economic services and income inequality are relatively related in the short run while public expenditure on social and community services play significant in reducing income inequality in both short and long run. Therefore, it is recommended that fiscal policy allocation should made adequate provision for investments in social and economic services in order to create better opportunities for everyone in a view to reducing the income divide within the Nigerian economy.
The present investigation inspected the effect of fiscal approach estimated by (Government use, Government incomes, inward open obligation, outside open obligation) notwithstanding fares and swelling factors on the Jordanian GDP development. Fiscal approach assumes a huge job in a monetary arrangement because of its capacity to acknowledge objectives went for by a national economy. Its instruments are viewed as one of the primary financial devices to accomplish monetary development and beat obstructions to monetary soundness. Notwithstanding its distributional and pro impacts, financial arrangement has steadiness initiating impacts, for example, government spending and expenses which impact total interest, along these lines influencing in general monetary factors and financial development. The significance of fiscal arrangement radiates from the way that open spending is viewed as the prime drive for financial movement of a nation by affecting the dimension of total interest and subsequently monetary development. Open incomes fill in as the principle wellspring of salary for a nation while open obligation is a piece of the administration’s spending, regardless of whether inside or outer. This paper introduces a utilization of a hypothetical model to survey the impacts of monetary arrangement on financial development.
The study determines the effect of government policies in both monetary and fiscal policies on price stability in Nigeria. Secondary data were sourced from CBN statistical bulletin for GR, GE, CRR, MPR & CPI. The study using OLS technique discovered that the combination of both monetary and fiscal instruments impacted on consumer price index in Nigeria within the period of review and concludes that regardless of the mixed individual impacts of the variables; government policies were able to manage consumer price index to a considerable extent. Thus, recommends enhanced fiscal procedures and monetary policies to facilitate desired price stability.
The study empirically examined the impact of fiscal policy on the economy of Nigeria between 1994 and 2014. Secondary method of data collection was used to generate data for this study and the sources of the data included annual reports /accounts and CBN statistical bulletin (2015). Multiple regression of ordinary least square estimation was the tool used to analyse the data in this study. In the model, real GDP (as dependent variable) was regressed on capital expenditure, recurrent expenditure, tax revenue and external debts. The study has revealed, that there exists no significant relationship between capital expenditure, recurrent expenditure, tax revenue and the real GDP representing the economy. However, the study found a significant negative relationship existing between external debts and the real GDP. This supports the Keynesian view of government active intervention in the economy using appropriate various policy instruments. The study therefore recommends that: Government should use fiscal policy to complement the adoption of effective monetary policy and maintain the rule of law to promote stability in the Nigerian economy. Government should ensure that capital expenditure and recurrent expenditure are properly managed in a manner that it will raise the nation’s production capacity and accelerate economic growth even as it reduces external borrowing.
Most industrialized countries over the years have passed through the agrarian era. In fact, the industrial sector takes its roots from the agricultural sector. In a developing nation, government fiscal responsibility is very central to all facets of development including agriculture. The study thus seeks to examine the impact of fiscal policy on the growth of agricultural sector in Nigeria between 1981 and 2013 using Error Correction Model (ECM). Unit root tests were conducted on each of the variables to avoid spurious regression results. Stationary variables were subsequently used for the analysis. The co-integration results showed that long run equilibrium relationship exists among the variables. The findings from the study revealed that custom and excise duties (CED) though statistically significant, relates negatively with volume of agricultural outputs (VAO). It shows that the amount of tax imposed on agricultural exports has not improved its productions and thus has a dampening multiplier effects on its growth. Value added tax (VAT) was however found to have influenced the growth of VAO positively and significantly. It shows that the amount of VAT imposed on agricultural outputs has improved the growth of the agricultural produce. The total government expenditures on agricultural sector were found to have negatively influenced agricultural growth in Nigeria. It showed that the amount of government expenditures towards the growth of the sector has not been favorable. Government capital allocation and expenditure to agriculture is relatively low and the actual expenditure falls short of budgeting expenditure. The rate of under spending was found to have been higher for agriculture than for any other economic sectors as large proportion of the funds allocated to agriculture has not gone directly to farmers. Suggestive from the analysis therefore is that Government should increase her budgetary allocation to this sector in a consistent manner because of its importance to the national economy, hoping that with proper monitoring of fund, it would contribute more significantly to the economy of the country. Customs and excise duties on agricultural exports should be stream-lined and more incentives should be given to rural farmers since they covered the larger population in agricultural sector.