Revenue Generation and Capital Projects Development in Lagos State, Nigeria

Abstract

Government capital expenditure is one of the instruments of fiscal policy in achieving macroeconomic objectives, as it improves the provision of capital projects and infrastructural facilities in the economy. Inadequate capital projects have contributed to poor infrastructural facilities in the Nigeria economy. Therefore, the populace is desiring of good infrastructural amenities from the government as well as the potential investors, as poor infrastructural facilities discourages potential investors from investing in the country. Availability and efficient use of revenue generated by the government would help in closing the gaps in the citizens' requirements of providing the infrastructures. This study examined the effect of revenue generation on the capital projects development in Lagos state from 2000-2018.This study employed ex-post facto research design. Population and sample size comprised entire revenue generated and total capital expenditures incurred for capital projects development in Lagos state from 2000 to 2018. Secondary method of data collection was employed and were sourced from the annual reports prepared by Accountant General of the State with Auditor General's validation and Central Bank of Nigeria Bulletins. It was analyzed using correlation and Ordinary Least Square regression.he findings revealed that government revenue has a significant effect on the total capital projects development in Lagos state as well as on RCAPEX and ECAPEX. Also, STR in isolation has a significant positive effect on the CAPEX, RCAPEX and ECAPEX. However, OIGR in isolation has an insignificant negative effect on CAPEX and ECAPEX and insignificant positive effect on RCAPEX.The study concluded that, Lagos state government is yet to economically, effectively and efficiently utilize the revenue generated for capital projects development. The study recommended that state governments should establish a revenue policy that will improve capital projects development rather than using other means of financing the capital projects.