THE IMPACT OF PUBLIC EXPENDITURE ON INFRASTRUCTURAL AND ECONOMIC DEVELOPMENT IN NIGERIA (1986-2022)

Abstract

The paper examined the impact of public expenditure on infrastructural and economic development in Nigeria from 1986-2022). The study was a time series thereby employing Secondary data sourced from the Central Bank of Nigeria (CBN) Statistical bulletin 2022. The data were subjected to unit root diagnostic test to determine whether they are stationarity or otherwise. The data were integrated of order 1(0) and 1(1). Therefore, the Autoregressive Distributed Lag (ARDL) model was adopted, the Error Correction Model (ECM) technique was also adopted to check for the cointegration. The study reported along run relationship between public expenditure on infrastructural and economic development. The result shows that Public expenditures on health and construction infrastructures negatively affect economic development in Nigeria. While public expenditures on education, transportation and communication, and economic and services infrastructures positively affects economic development in Nigeria. The study concludes that pubic infrastructural expenditures influence economic development in Nigeria and the paper recommend that the financing options for closing Nigeria’s infrastructure gaps should focus on broadening the sources of finance and a better allocation of public resources. In this wise, the government should intensify the utilisation of the public-private-partnership (PPP) framework as government alone cannot finance infrastructural development in an emerging market economy like ours. Therefore, Nigeria needs to be more pragmatic in her infrastructural development, in order to create employment and reduce poverty.