Fiscal Policy and Macroeconomic Performance in Nigeria

Abstract

This study examines the contribution of fiscal policy measures to economic stability in Nigeria. Specifically, the study examines the impact of fiscal policy measures on macroeconomic variable of growth - the gross domestic product. In order to achieve our objectives, we employed the econometric techniques of ordinary least squares and co-integration/error correction mechanism to analyze our data with a scope of 1970 to 2019. Our results and findings show that fiscal policy measures had serious implication on economic growth. This is evidenced by the coefficient of determination of the model. The R2 value is consistently high in the model. Also, government expenditure and revenue were significant in the model. Based on findings, the study recommends that government should improve her role in the economic management by stepping up her capital expenditure and reducing recurrent expenditure in order to boost infrastructural development and create the enabling environment for increased private investment in the economy.