Abstract

This paper uses the multiple regression analyses to investigate the extent to which government spending crowd in or crowd out private investment in Nigeria. The analysis is conducted using 34 years of annual data for Nigeria. The paper lays emphasis on disaggregating the capital and recurrent spending of the federal government and examining their separate effect on private investment. The analysis suggests that effective macroeconomic management be ensued in order to cushion the adverse effect of rising inflation on private investment.

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