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| Title: | Public Expenditure and Economic Growth: A Test of Keynesians Prepositions in Nigeria |
| Author(s): | OZUZU CSR. |
| Abstract: | This study examined the effect of public expenditure on Nigeria economic growth from 1987-2020. The objective was to test Keynesians preposition on the effect of government expenditure on economic growth. Time series data were sourced from Central Bank of Nigeria Statistical bulletin and publications of Nigeria Bureau of Statistics. Real gross domestic products was proxy for dependent variables while the independent variables were proxied by Nigeria capital expenditure on administration, Nigeria capital expenditure on Economic services, Nigeria capital expenditure on Social services and Nigeria capital expenditure on Transfers. Ordinary least square methods of co integration, granger causality test, unit root test and Vector error correction model. The coefficient of determination (R2) shows that 53.3 percent of variation in Nigeria real gross domestic products is caused by variations in public expenditure. Beta coefficient of the variables indicates that public capital expenditures have positive and significant effect on Nigeria economic growth. From the findings, the study concludes that Keynesians preposition on the effect of government expenditure holds in Nigeria. The study recommend that better implementation of the annual budget and government expenditures should be directed to productive ventures of the economy to enhance the economic growth, government should increase the share of the capital expenditure especially on meaningful projects that have direct bearing on the citizen’s welfare. Capital expenditures on economic services should be directed mainly at the agricultural sector so as to stimulate activities in the economic sectors and, perhaps, reverse the negative effect on economic development. Government should devote more attention in the allocation of government expenditures. Enforce monitoring and evaluation of public expenditure to ensure that released funds are not misused which will engender effectiveness. |
| Keywords: | Public Expenditure, Economic Growth, Test of Keynesians’ Prepositions, Nigeria |
| Journal: | Journal of Contemporary Research in Economics and Development Studies (JCREDS) |
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