EFFECT OF PUBLIC EXPENDITURE ON ECONOMIC GROWTH OF NIGERIA

EFFECT OF PUBLIC EXPENDITURE ON ECONOMIC GROWTH OF NIGERIA

Bennee, Emmanuel

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: emmanuelbennee@gmail.com

Okoye, Pius V.C.

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: vynopee@gmail.com;

Amahalu, Nestor N.

Department of Accountancy

Nnamdi Azikiwe University, Awka

Mail: ferryfontee@gmail.com;

Abstract

The broad objective of this study is to ascertain the relationship between public expenditure and economic growth of Nigeria.  The specific objectives are to: determine the relationship between health care expenditure and real gross domestic product of Nigeria and to ascertain the relationship between national defense expenditure and real gross domestic product of Nigeria. The study adopted Longitudinal (Ex-post facto) research design. Data extracted from Central Bank of Nigeria (CBN) Annual Reports and Statement of Accounts and Statistical Bulletins of various issues, National Bureau of Statistics (NBS) bulletin, Budget Office of the Federation, World Economic data base, United Nations statistical bulletin, International Monetary Fund (IMF)  of Nigeria for the study periods. Regression analysis was used to test the data via E-Views 10.0. This study revealed that a significant and positive relationship exist between national defense expenditure (t-Statistic = 2.828368 < 0.05), a negative and non-significant relationship between health care expenditure (t-Statistic = -0.201165 > 0.05) and RGDP. Based on findings of the study, the study recommendations were suggested: In order to reverse the negative relationship between health care expenditure and economic growth, Government should ensure that health investments are directed to improving health standard of the population. Also, investing carefully in various healthcare aspects would boost income, GDP and productivity, and alleviate poverty.

Keywords: Health care expenditure, National defense expenditure and Real gross domestic

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