Government Recurrent Expenditure Research Articles

EFFECT OF SUBNATIONAL PUBLIC EXPENDITURE ON STATES’ FISCAL SUSTAINABILITY IN NIGERIA

Objectives: The study examined the effect of subnational public expenditure on states’ fiscal sustainability in Nigeria. Specifically, the study examined the effect of capital expenditure and recurrent expenditure on states’ fiscal sustainability in Nigeria. Methods Ex-post facto research design was adopted to carry out the research for the period 2016-2022. The panel data were collected and sourced from Audited Financial Statements of subnational, CBN statistical Bulletin, CBN Annual report and accounts, other CBN publications, publications of the National Bureau of Statistics (NBS), and Ministry of Finance (MOF) Medium Term Fiscal Framework and other publications of 36 states. Panel regression was used to analyse the hypothesis significant effect between subnational public expenditure and states’ fiscal sustainability in Nigeria with the aid of E-views 12. Results: The study found that capital expenditure has a significant effect on states’ fiscal sustainability in Nigeria. The study also found that recurrent expenditure negatively affects states’ fiscal sustainability in Nigeria. Conclusion: The study recommends that the state governments of Nigeria should adhere strictly to the implementation of capital expenditure so as to increase the level of infrastructural and productive base in Nigeria which will have the capacity to stimulate economic growth and create employment. Also, state governments should decrease spending, particularly regarding recurrent expenditure, to reduce the cost of governance in the country. This is because our results indicated that an increase in government recurrent expenditure reduces the level of the sustainability index.

Nexus between Inflation, Economic Growth and Government Expenditure of Nepal

In the context of Nepal, this study will explore the relationship between the rate of inflation, economic growth, and government spending. Government spending has been broken down in this analysis into three categories: government recurrent expenditure, government capital expenditure, and government financing expenditure. The time series data from 1974 to 2021 are used in the investigation. The econometrics tools used to analyze this link are the Granger-causality test, ARDL, Johansen co-integration, and the Augmented Dickey- Fuller (ADF) unit root test. The outcomes of using these econometric techniques reveal a long-term relationship between the rate of inflation, economic growth, and government spending, which indicates that public spending has beneficial externalities and links. In the short run, government spending has a greater impact on economic growth than the rate of inflation. The results of the causality test indicate that there is a one-way causal relationship between the rate of inflation and both economic growth and government spending.

Health Infrastructure and Economic Development Nexus in Nigeria

Nigeria like many other Sub-Saharan African countries has been plagued with lack of functional infrastructure in order to grow the economy. Recent events in Nigeria, such as the COVID-19 pandemic, which emerged in late 2019 and continues to impact Nigeria, has exposed the vulnerabilities and weaknesses in the country's health infrastructure. This study investigates the impact of health infrastructure on economic development in Nigeria. The study employed time series data. Health infrastructure was captured by government recurrent and capital expenditure on health while economic development was proxied by per capita gross national product. The Autoregressive Distributive Lag (ARDL) estimation technique was used to establish the long run relationship among the variables. It was revealed that long run relationship exists among the variables in the estimated model. The results of the Error Correction Mechanism (ECM) within the framework of the ARDL shows that health infrastructure has significant impact on economic development in Nigeria. The study concludes that health infrastructure plays key roles in influencing economic development in Nigeria, and for the optimal performance of the economy, the government must increase infrastructural spending on health care in order to reduce the rate of maternal, infant and under-five mortality in the country. The study recommends that; there is a need for the government at all levels to massively invest in the provision of health infrastructure which is a strong viable means of reducing mortality incidence and enhancing economic development in Nigeria. Nigeria’s share of government expenditure to the health sector ranges between 5-7 percent, which falls immensely below the minimum standard of 16 percent as recommended by UNESCO for a developing country, which calls for emergency intervention in the health sect

RECURRENT EXPENDITURE ON INTERNAL SECURITY AND ECONOMIC GROWTH IN NIGERIA

It is the responsibility of the government to ensure the internal safety of those living in the country. This is because it (the government) has the resources needed to deploy and ensure that the country is safe. To achieve internal safety, the federal government of Nigeria has continued to increase expenditure on internal security with a view of securing all those living in the country for investment and innovation. Thus, this paper investigated the relationship between government recurrent expenditure on internal security and economic growth in Nigeria from 1980 to 2022. The data for the study were sourced from Central Bank of Nigeria statistical bulletin. The Autoregressive Distributed Lag (ARDL) model was employed as the main analytical tool. The results of the analyses revealed the presence of a long-run association among the variables. The results also showed that in the long run, government recurrent expenditure on internal security has a positive and insignificant relationship with economic growth in Nigeria. At the same time, exchange rate has a positive and significant relationship with economic growth in Nigeria. Also, interest rate has a negative and significant relationship with economic growth in Nigeria. In the short run, government recurrent expenditure on internal security has a negative and significant relationship with economic growth in Nigeria. The exchange rate and interest rate have a positive and significant relationship with economic growth in Nigeria. The study concluded that the relationship between government recurrent expenditure on internal security and economic growth in Nigeria varies, as it could be positive (in the long run) or negative (in the short run). Therefore, the study recommended that recurrent expenditure on internal security which includes pay to officers, salaries to specialists within internal security forces or connected to internal security organizations, pensions of internal security personnel; and social services for personnel and their families; maintenance and operations; internal security research and development, medical services, etc. should be increased because in the long run it will provide a spin-off effect on the national economy and increase economic growth.<p> </p><p><strong> Article visualizations:</strong></p><p><img src="/-counters-/soc/0014/a.php" alt="Hit counter" /></p>

Effect of Government Recurrent Expenditure on Economic Prosperity in Nigeria

Effect of Government Recurrent Expenditure on Economic Prosperity in Nigeria

Empirical Investigation of Government Expenditure and Tax Payers Compliance in Nigeria

The research looks at taxpayer compliance and government spending in Nigeria’s economy from 1992 to 2022. The CBN statistics bulletin from 2022 served as the source of the data. The research used many factors, including public capital spending, government recurrent expenditure, compliance with value-added tax, firm income tax compliance, and gross domestic product and put (GDP), as indicators of the Nigerian economy. Analytical methods for the research included time-series econometrics. Additionally, the analysis demonstrates that capital expenditures by the government significantly boost Nigeria’s GDP. Although insignificant, government recurrent spending has a favourable effect on Nigeria’s GDP. Nigeria’s gross domestic product benefits greatly from value-added tax compliance and Company income tax compliance. According to the coefficient of determination, changes in government spending variables may account for almost 78% of the fluctuations in the Nigerian economy. The paper concludes that government expenditure and tax payers’ compliance has a substantial outcome on the Nigerian economy. Recommendations are that, Government should reduce the amount set on value added tax and company income tax, to boost compliance and that generated tax revenue must be sufficiently, efficiently and judiciously utilized. Fiscal policies towards increase in recurrent expenditure should be the norm. Government should spend more on recurrent expenditure because it has a positive impact on the economy. Lastly, capital projects should be well supervised to ensure that it meets the needs of the people.

Fiscal Policy and Inflation in Nigeria

Aims: This study aims to analyze how Nigerian government activities impact inflation, considering the inadequacy of monetary policy. It focuses on recurrent and capital expenditures in various sectors and their influence on inflation, as well as public debt and tax revenue's role in inflation dynamics.
 Study Design: The study employed secondary data.
 Place and Duration of Study: Data sources include the National Bureau of Statistics (NBS), Central Bank of Nigeria (CBN) statistical bulletin, Debt Management Office (DMO), and World Development Indicators (WDI) spanning from 1986 to 2021
 Methodology: The study employs econometric techniques, including unit root tests and Autoregressive Distributive Lag (ARDL) analysis, with Inflation Rate (IFL) as the dependent variable. Independent variables representing fiscal policy include capital expenditure on transfers (CTRA), recurrent expenditure on administration (RADM), recurrent spending on social and community services (RSCS), recurrent expenditure on economic services (RECE), recurrent expenditure on transfers (RTRA), capital expenditure on administration (CADM), capital spending on social and community services (CSCS), capital expenditure on economic services (CECE), government direct and indirect taxes (TAX), government capital expenditure (GCE), government recurrent expenditure (GRE), and external debts (PUD).
 Results: Key findings reveal that in the long run, only RADM, RTRA, CADM, CECE, CSCS, GRE, GCE, PUD, and TAX had statistically significant relationships with inflation (IFL). RADM, CECE, CSCS, GCE, PUD, and TAX exhibited negative relationships with IFL, while RTRA, CADM, GRE showed positive relationships. In the short run, RSCS, RTRA, CADM, CECE, CSCS, CTRA, GRE, GCE, and TAX displayed statistical significance. RSCS, RTRA, CADM, and GRE positively correlated with IFL, while CECE, CSCS, CTRA, GCE, and TAX had negative associations.
 Conclusion: The study concludes that Nigeria's fiscal policy should prioritize increased government capital spending in economic and social sectors to manage inflation effectively. Additionally, implementing fiscal restraint through higher taxation can help mitigate inflationary pressures.

Oil Price Volatility and Federal Government Recurrent Expenditure in Nigeria: Mediating Role of Exchange Rate

An empirical examination of the impact of oil price volatility on federal government recurrent expenditure in Nigeria and the mediating role of exchange rate from 1980 to 2022 was carried out in this study. The Generalized Autoregressive Conditional Heteroskedasticity (GARCH) model was used in the data analysis. The findings reveal compelling evidence that oil price volatility as measured using the Brent oil volatility has a significant effect on recurrent federal government spending patterns. The analysis also shows that exchange rate variations serve as significant control variable that influence oil price fluctuations and federal government recurrent expenditure. Hence, the study recommends that federal government should create and properly administer a stabilization fund to save excess oil revenue during periods of boom to lessen the immediate effects of oil price volatility and the abrupt impact on budgetary allocations on recurrent expenditure. There is also the need to have a deep-cut on unproductive recurrent expenditures by federal government and its appointees. The study further recommends the adoption of a closely monitored exchange rate policy by government.

The Nexus Between Public Revenue and Government Expenditure in Nigeria

This study examined the effect of government revenue on government expenditure in Nigeria. The study used a retrospective research design and data was obtained from a statistical bulletin from the OECD, CBN, IFRS and National Bureau of Statistics for the period 1981 to 2020. Descriptive statistics, correlation and multiple regression analysis were used to analyze the data based on SPSS 20.0 and the Advanced Excel Analytical Toolkit 2018 package. The result revealed a positive and statistically significant relationship between corporate income tax (CIT) and Government Capital Expenditure (GCE). The relationship between Value Added Tax (VAT) and Government Capital Expenditure (GCE) is also positive and statistically significant. Furthermore, CIT and VAT have been shown to have a positive and statistically significant relationship with government recurrent expenditure (GRE), respectively. Thus, the study reveals a significant relationship between government revenue and government expenditure in Nigeria. Among other things, we recommend that the government increase the number of goods on which Nigeria is subject to VAT to expand net VAT revenue as well as the collection of other indirect taxes to improve all public spending on Nigeria's economic growth - in line with Keynesian theory of expenditure and economic growth. Furthermore, in order to increase revenue for the CIT, according to Adolf Wagner's law of increasing public spending, the government must use tax money to create a favorable economic environment that stimulates high levels of industrial activity, thereby greatly affecting corporate performance and profits.

Impact of Fiscal Policy on Inflation in Nigerian Economy

This paper examines the impact of fiscal policy on inflation in Nigeria for the period 1981-2021. The study adopts autoregressive distributed lag (ARDL) bounds testing approach. The unit root results revealed that other variables apart from inflation were stationary after first difference. The bound test result shows that the variables cointegrate. The ARDL long-run result shows that oil revenue has a negative significant impact on inflation, while government recurrent expenditure and capital expenditure have positive impact on the inflation, with the impact of recurrent expenditure significant. The results further showed that the impacts of oil revenue, recurrent expenditure, and capital expenditure in long-run was also maintained in the short run. Lastly, exchange rate and total imports have negative impact on inflation, while foreign direct investment inflow has a positive impact on inflation in both long- and short-run. The government should review her fiscal policy to adjust recurrent and capital expenditure, and to reduce import by encouraging consumption of local products.

Relevance of Fiscal Illusion Proposition and Wagner Theory to Nigerian Budget Performance (Nexus among Fiscal Illusion Index, Recurrent and Capital Budget)

This paper presents an empirical analysis of the consequences of fiscal illusion for public spending outcomes in a developing country context, specifically Nigeria, over the period 1993- 2022. The presence of fiscal illusion and its main indicators are identified (measured here through deficit illusion, and degree of tax visibility, where the real burden of taxation is underrepresented to the citizen-voter). We find that the Nigerian economy reveals significant fiscal illusion as measured in above terms. Also, fiscal illusion is found to have major and positive impact on the demand for government capital expenditure and government recurrent expenditure and consequently, on real government expenditure in the economy over the chosen time period. This work demonstrated that the controversial question involving the role of fiscal illusion practices on public finances is not recent, but can be thought of as deriving from the discussion invoked by Puviani (1903) and substantially enriched by Buchanan (1960). In spite of the fact that the ‘Fiscal Illusion’ School of Buchanan and Wagner (1977) identifies higher levels of fiscal illusion promoting increasing increments in the size of the public sector, this work developed a model that predicts higher levels of fiscal illusion also decrease national economic growth rates. The government additionally creates the false illusion that public expenditures are lower than they are in reality and for this reason it is easier to maintain the illusive fiscal discipline. On the one hand, the government may cut expenditures in an ostensible way and step towards reducing the budget deficit. On the other hand, without additional procedures the government may introduce new public expenditures outside the budget and, consequently, without any special control of the law-making arm of government.

Effect of Government Expenditure on Inflation in Nigeria

This study examined the effect of government expenditure on inflation in Nigeria while disaggregating expenditure into capital and recurrent. The study also examined the response of inflation to changes in government expenditure in Nigeria. Secondary data collected from the Central Bank of Nigeria Statistical Bulletin was employed for a period of thirty-eight years (i.e. 1981-2019). The Auto Regressive Distributed Lag technique was employed. For the first model explaining government capital expenditure, short run estimates reveal that in the current period, government capital expenditure has a significantly negative relationship with inflation. For government recurrent expenditure, it was established that government recurrent expenditure has a positive relationship with inflation. The impulse response test used in analyzing the effect of an unanticipated change in government expenditure (capital and recurrent) on inflation shows that the effects of the change in both cases are temporary as they are seen to revert to the mean. The study recommends that the government should maintain a good strategic balance between capital and recurrent expenditure to prevent the economy from being consumption - based.

Globalization–health outcomes nexus and institutional intermediation in Nigeria

PurposeThe role institutional quality plays in the rising pace of globalization and its associated health effects remain unclear in the literature. This study, therefore, empirically examined the moderating role of institutional quality on the globalization-health outcomes nexus in Nigeria, a country with a relatively weak health system.Design/methodology/approachThe study employed Dynamic Ordinary Least Square (DOLS) to estimate the empirical models. The Fully Modified Ordinary Least Square (FMOLS) and Canonical Cointegration Regression (CCR) techniques were thereafter used to check the consistency and robustness of our results. Annual time-series data spanning from 1984 to 2020 were sourced from the World Development Indicator, KOF Globalization Index, International Countries Risk Guide (ICRG) and Central Bank of Nigeria Statistical Bulletin databases.FindingsThe results revealed that overall globalization and its three dimensional components (economic, political and social globalization) adversely affect life expectancy in their separate models, but increased life expectancy significantly after their interaction with government effectiveness. Also, real GDP, health aids, government recurrent health expenditure are other determinants of life expectancy in Nigeria.Practical implicationsThe Nigerian government should put in place appropriate mechanisms directed toward building and sustaining government effectiveness. This will help mitigate the negative effects of globalization and utilize its net positive benefits to improve life expectancy in Nigeria.Originality/valueThe research is the first to comprehensively examine the moderating impact of institutional quality on the nexus between overall globalization as well as its three dimensional components (economic, political and social) on health outcomes in Nigeria.

Appraisal of Government Recurrent Expenditure Pre- and Post-Integrated Personnel Payroll Information System Implementation in Nigeria

The study appraised government recurrent expenditure pre- and post-Integrated Personnel Payroll Information System implementation in Nigeria. Government recurrent expenditure on general administration, government recurrent expenditure on education, government recurrent expenditure on defence, and government recurrent expenditure on health, formed the dependent variables of the study. The study adopted an ex-post-facto research design, covering the period between 1995 and 2019. Secondary data were extracted from the Central Bank of Nigeria Statistical Bulletin. Paired Sample T-test technique was used for the data analysis. In line with the specific objectives of the study which was to appraise the difference in the mean of government recurrent expenditure on general administration, education, defence, and health pre and post Integrated Personnel and Payroll Information System implementation in Nigeria, it was revealed that all the recurrent expenditures studied have a positive and significant difference in mean after IPPIS implementation in Nigeria. This implies that IPPIS has not been able to cutdown government recurrent expenditure in Nigeria. It is recommended therefore that the federal government should adequately monitor and utilize the money saved from recurrent expenditure due to implementation of IPPIS. They should employ more administrative staff using the money saved from eradicated ghost workers. The government should consider an upward review of the educational budget to meet up with the 26% allocation recommended by UNESCO and above. The government should monitor how the huge amount of money spent on defence was appropriated. This will help in preventing and stamping out corruption. An encompassing stakeholders’ forum in the Nigerian health sector remain essential. The national health system needs a solid administrative policy foundation that allows coordination of priorities and partnerships in the health workforce and among various stakeholders. This will help stamp out embezzlement and corruption in the system.

Effect of Government Capital Expenditure on Tourism Sector Growth in Kenya

Tourism is a vital sector of Kenya’s economy by contributing to employment, alleviation of poverty, Gross Domestic Product (GDP), foreign exchange earnings, and balance of payments surplus. Tourism is a productive economic activity that needs a stable macroeconomic environment in terms of budgetary resource allocation for sustainable and continued growth. Thus, this study sought to establish the effect of government capital expenditure on tourism sector growth in Kenya. The study adopted a causal research design using quarterly time series data from 2012 to 2021. The findings revealed that government capital expenditure (t=3.4746, p<0.05), government recurrent expenditure (t=6.1303, p<0.05), and taxation (t=2.8608, p<0.05) had positive significant effects on tourism sector growth in Kenya. The study recommends an increase in capital budgetary allocation for continued growth of the sector which is the main source of foreign revenue in Kenya.

Effects of Some Macro-Economic Variables on Agricultural Output: Implication for Food security in Nigeria (1980-2020)

The study explored the effects of some macroeconomic variables on agricultural sub-sector output: implication for food security in Nigeria (1981-2020). The study specifically looked at the effects of money supply, interest rate, inflation rate, exchange rate and government recurrent expenditure on agricultural output in Nigeria. Central Bank of Nigeria (CBN) Statistical Bulletin, index mundi and journals were used as sources for the annual time series data on the research variables for the period 1981–2019. The Autoregressive Distributed Lagged Model was used in the study. The unit root test revealed in the pre-diagnostic tests that the variables were stationary at 1(0) and 1(1). The ARDL Bound test for co-integration revealed that the variables had long-run co-integrating relationship. Additionally, empirical findings indicated that, in the short run, exchange rate, government recurrent expenditure and money supply as macroeconomic variables affected agricultural output The study recommends that since the research showed that money supply had positive effect on agricultural output, government should inprove on money supply so as to enable farmers meet up their required purchases.

Government Fiscal Policy and Foreign Direct Investment in Nigeria: An Application of VAR Model

Purpose: The aim of this paper is to examine the impact of key fiscal policy variables (government capital expenditure, government revenue, government recurrent expenditure, external debt and tax revenue) on foreign direct investment and to check if there exists a causal relationship between fiscal policy and Foreign direct investment in Nigeria. Approach/Methodology/Design: Times series Econometrics methods such as Vector Autoregressive (VAR) Model, unit root test, cointegration test, Lag selection test and Granger causality test on annual data obtained from CBN statistical bulletin and National Bureau of Statistics spanning 1985 to 2020 were used. Findings: The results of the unit root test showed that FDI, government capital expenditure, government revenue and tax were stationary at order one (1), while recurrent expenditure and external debt were stationary at order zero (0). Also there exists co-integration among all the variables in the model. The findings showed that fiscal policy has insignificant impact on foreign direct investment in Nigeria. Originality/value: The results of this paper give valuable information on the relationship that fiscal policy may have with foreign direct investment and a need for a well-articulated and coordinated fiscal policy to attract FDI in Nigeria for optimum growth and development.

Educational Investment and Unemployment in Nigeria

Education is a fundamental human right and is essential for the development and progress of any nation. It is a general belief that educated individuals fare better in the labour market than the less educated. This study empirically examines investment and expenditures in education, and its influence on unemployment rate in Nigeria from 1991 to 2021. Unit root test, ARDL approach, bound test, Breusch Godfrey serial correlation LM test and the CUSUM test were employed. Unemployment rate (UER) was used as the dependent variable while Federal government recurrent expenditure (GEE), credit to private sector (CPS), average of school enrollment rate (ASE) as proxy for literacy rate, labour force participation rate (LFP) and gross fixed capital formation (GFCF) as the independent variables. Findings revealed that apart from UEM that is stationary at the level, the other variables are stationary at first difference given the 5% level of significance. Labour force participation rate is statistically significant. There is an insignificant positive relationship between government recurrent expenditure on education and unemployment rate in the long -run. On the other hand, credit to private sector, school enrolment rate, and gross fixed capital formation all conform to their a priori expectations, but are insignificant, i.e., statistically indifferent from zero. The study recommended among others that an actionable and working fiscal policy in the educational sector should be established and government should improve on the quality of institutions through better teacher training, investment in educational research development, and the establishment of vocational training centers that provide practical skills to students.

Effect of Fiscal Policy on Poverty in Nigeria

The study investigated the effect of fiscal policy on poverty in Nigeria. The study covered 35-year period, spanning from 1986 to 2020 being a liberalized era in Nigerian economy. Fiscal policy being the explanatory variables, was disaggregated into federal government retained revenue (FRR), government capital expenditure (GCE), government recurrent expenditure (GRE),non-oil revenue (NOR), and public debt (PD). Poverty index as a dependent variable, being the unit measure for change in the poverty rate was used as proxy for poverty. Diagnostics test employed were, descriptive statistics to measure the mean, standard deviation, kurtosis and skewness as well as the Jarque-Bera statistics of the variables, while Augmented Dickey-Fuller unit root test was used to test for the stationarity of the data and Autoregressive distributive lag co-integration was employed to test for long-run relationship existing among the variables. Autoregressive distributive lag (ARDL) was used for the analysis since there was a long run relationship existing among the variables and Granger causality test was also employed to measure the directional relationship of the variables under study. The unit root test result showed that all the variables studied were stationary at first difference except NOR and FRR which were stationary at level, and co-integration result showed that fiscal policy has a significant long run relationship with poverty in Nigeria. The ARDL result showed that non-oil revenue showed initial negative government retained revenue but started effect of -3.298345 Lag 3, and then consistent positive effects 6.062662 Lag 4 through the short run periods. The federal government retained revenue showed initial negative effect of -3.739652 Lag 2followed by positive effect of 0.390469 Lag 3 and a return on positive effect of 6.249618 Lag 4 within the short run period. The government capital expenditure had similar trend as the federal retained revenue with a negative effect of -6.786381 in the initial period and first lag and then swung between positive and negative effects within the short run period, while the government recurrent expenditure started out with three year lagged period positive effects of 3.069591, 5.9766088, & 4.406814 but ended with negative effect of -7.978000. It was only the public debt profile that out rightly showed negative effect. Public debt has initial negative effect of -1.323569 and positive effect of 3.415523 Lag 3on the short run. Granger causality showed that non-oil revenue and public debt had causal effects on poverty reduction while federal government retained revenue, capital expenditure and recurrent expenditure do not have causal relationship with poverty reduction in Nigeria. The study concludes that fiscal policy with adjusted R2 of 0.993059 (99%) and p. value of 0.006425 has a significant effect on poverty in Nigeria. It was recommended that revenue and expenditure be increased while public debt be minimized in order to reduce poverty in Nigeria.

IMPACT OF GOVERNMENT EXPENDITURES ON INDUSTRIAL OUTPUT IN NIGERIA

The major goal for government expenditure policies according to Keynes is to improve the effective demand which is aimed at increasing industrial output in developing countries like Nigeria. Therefore, this paper is an attempt to examine the impact of government expenditures on industrial output in Nigeria. Thus, the methodology of this paper is the time series data method which were sourced from the Central Bank of Nigeria statistical bulletin 2021 and the study also employed the Fully Modified Ordinary Least Squares (FMOLS) because the data were co-integrated at order 1(1) and the Johansen co-integration test result revealed that there are two (2) co-integrating equations. The R-Square of 98 percent suggests that government expenditures have a positive relationship with industrial output in Nigeria. Specifically, the result revealed that government capital expenditures have a positive and insignificant impact on industrial output in Nigeria. However, the government's recurrent expenditure was said to have a positive and significant impact on industrial output in Nigeria. Therefore, the study recommended that government should review the recurrent expenditures to be real sector and industrial output is driven to increase the impact of industrial output in Nigeria. Similarly, the government should design a mechanism to track the government capital expenditures in Nigeria to ensure that projects are industrial driven especially the infrastructural projects for industrial output in Nigeria.