IMPACT OF GOVERNMENT SECURITY EXPENDITURE ON ECONOMIC GROWTH IN NIGERIA

Abstract

This study is an attempt to assess the impact of government security expenditure on economic growth in Nigeria from 1986-2018. The study was carried out using time series data, and econometrics tools were used for testing and estimation. Augmented Dickey-Fuller (ADF) was used to test the stationarity, the Ordinary Least Square (OLS) and Error Correction Model (ECM) techniques were used to estimate the impact of government security expenditure on economic growth in Nigeria and the causality test was also carried out to show the casual relationship among the economic variables using Granger test. From the study’s findings, the data were stationary at various levels and the impact estimated result shows that government security expenditure has strong impact on economic growth in Nigeria given the R2 Square of 0.97. While long run result revealed that Government Recurrent Defence Spending in Nigeria (GRDEXP), Government Recurrent Internal Security Spending in Nigeria (GRISEXP) and Government Security Capital Expenditure in Nigeria (GSCAEXP) were statistically significant at 5% level of significance. Also, ECM result revealed that all the independent variables were statistically insignificant in explaining the variation in Real Gross Domestic Products (RGDP) in Nigeria except Government Recurrent Defence Spending in Nigeria (GRDEXP).Therefore, the study recommends that government should design a mechanism to ensure all monies spent in Security in Nigeria are accounted for economic growth in Nigeria.