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Rivers State University, Port Harcourt.
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| Title: | Sector-specific Aid And Poverty Reduction In Nigeria |
| Author(s): | Achimugu A. A |
| Abstract: | The growing incidence of poverty amidst inflows of international aid triggered an econometric investigation into the relationship between sector-specific aid and poverty reduction in Nigeria during 19812020. The specific objectives are to examine how aid to education, health and agriculture sectors contributes to poverty reduction. Time series on the aid indicators and poverty headcount were obtained from the Organization for Economic Cooperation and Development (OECD) Statistics and National Bureau of Statistics (NBS). The data analysis tools include unit root test, cointegration test and vector error correction model (VECM).The unit root test results revealed that all the variables are stationary at first difference which imply that they all integrated of order one [I(1)]. The Johansen cointegration test results reveal that two cointegration equations exist in both trace and maximum eigenvalue equations. The implication of this finding is that at least two of the variables tend to adjusts speedily to long run equilibrium position. The estimated VECM reveal that aid to education helped in the development of the stock of human resources through improved knowledge, skills and health status, thereby reducing the level of poverty in the long run. At the same time, aid to agriculture is significant in reducing poverty. The implication of this finding is the increased aid to the agriculture sector improves the productivity of the sector, and in so doing creates opportunity for food security in the country. On the other hand, aid to the health sector is positively related to poverty headcount in the long run. The error correction parameter reveals that short error deviations in the system can be adjusted to long run equilibrium position at a speed of 5.6 per cent. Based on the findings, this study recommends that government should ensure that aid to education sector is allocated to promoting inclusive and quality education and lifelong learning for all to create opportunity for poverty reduction. |
| Keywords: | Aid, Poverty, Educational Sector, Agricultural Sector, Health Sector |
| Journal: | Journal of Contemporary Research in Economics and Development Studies (JCREDS) |
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