Government Expenditure and Economic Development in Nigeria: A Disaggregated Approach

This study evaluated government expenditure and economic development in Nigeria using time series data of 34 years from 1990 till 2023. Government expenditure was disaggregated into government spending on education, government spending on health, and government spending on agriculture as the independent variables and GDP per capita as the dependent variable. Time series data was generated and analysed using Autoregressive Distributed Lagged (ARDL) technique. The study found that government spending on education had a significant positive impact on GDP per capita, with an unstandardized coefficient of 0.186 and a p-value of 0.031. Conversely, government expenditure on health showed an insignificant positive impact, with an unstandardized coefficient of 0.062 and a p-value of 0.455. Government spending on agriculture was found to have a negative effect, but it was not statistically significant, with an unstandardized coefficient of -0.031 and a p-value of 0.403. The regression model explained approximately 99.5% of the variation in GDP per capita (R² = 0.995), indicated a strong relationship between government spending and economic development. Based on these findings, the study recommended prioritizing education, improving health expenditure efficiency, enhancing agricultural policies, and ensuring effective resource allocation to maximize the potential of government spending in economic development