The Effect of Government Recurrent Expenditure on the Economic Growth in Sierra Leone

Economic growth is important for poverty reduction and it is of interest to all policy makers. Also, determining the expenditure pattern is important for boosting the revenue base and hence growth and it takes various forms. The study therefore investigates the effect of recurrent expenditure on economic growth in Sierra Leone. The data uses an aggregate amount of data on real GDP, public consumption, and other control variable for the period 1992 to 2022. Variables are tested for the existence of unit roots and the Autoregressive Distributed Lag (ARDL) was used to test for cointegration and estimation of short-run and long-run models of growth. The results show that public consumption has a negative effect on economic growth in Sierra Leone. Other results show that real exchange rate and inflation have a negative effect on real GDP growth. Public consumption which serves as one of the key variables that determines recurrent expenditure portrays a negative effect on the economic growth in Sierra Leone in the long run. The policy recommendation is that the government should reduce extra-budgetary support by cutting down recurrent expenditure on the consumption of fuel, per deem, and rent age of private enterprises to host government conference meetings.