ASSESSING THE DRIVERS OF GOVERNMENT RECURRENT EXPENDITURE IN NIGERIA
Adamu Jibir, Chadrach Caesar, Bashir Bappayaya and Nayuni Charles Sabe
Volume 9 Issue 2
Abstract
The study investigates the drivers of government recurrent expenditure in Nigeria using time series data spanning between 1980 and 2022. The study employs Autoregressive Distributed Lag (ARDL) model. The study incorporate variables such as; Inflation, population of age 15 to 65, sum of population age of under 15 and above 65, recurrent expenditure, real gross domestic growth and total debt- to examine their effect on government expentditure size. The findings of the study reveal that total debt, total revenue have positive and significant impact while sum of population age of under 15 and above 65, inflation have negative and significant impact on recurrent expenditure in Nigeria. Gross domestic product and population age of 15-65 have negative and insignificant impact in determining recurrent expenditure in Nigeria. The study recommends among others that the revenue base of the country should be diversified beyond oil sector, strengthening of fiscal and monetary policies to ensure stability in price level and exchange rate, the use of fiscal rule through excess crude oil account should also be strengthened to create buffer against fluctuation in oil price and as well appropriate population reduction policies should be undertaken to curtail rapid population growth, private investment should be encourage as it boost public spending while public debts might be counterproductive. Key-words: ARDL, Recurrent Expenditure, Government Expenditure, Wagner’s Hypothesis
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