ANALYSIS OF NON-OIL REVENUE AS A DRIVER OF ECONOMIC GROWTH IN NIGERIA

Danladi Augustine , Francis A. Akawu, PhD, Moses S. Ajidani, PhD and Osekweyi J. Odonye, PhD
Volume 10 Issue 1

Abstract

The study assessed the impact of non-oil revenue as a driver of economic growth in Nigeria. The study used the ex-post facto research design and the Autoregressive Distributed Lag (ARDL) Model to analyze the relationship between non-oil revenue and economic growth in Nigeria. Time series data used in the study were collected from the Central Bank of Nigeria Statistical Bulletin, the NBS and various online sources for the periods 1986 - 2023. Unit root test, cointegration test and granger causality test were conducted on the data (RGDP, MSR, AGR, SMR, and TSR) and the results shows the data were all stationary of order one (1(I)) and were all cointegrated with economic growth of Nigeria in the long run. The result of the ARDL regression showed an R2 of 0.97 which indicates the model’s goodness of fit. From the regression result, in line with the apriori expectation, MSR showed a positive coefficient and contributes 1.00 percent to growth. MSR was also statistically significant given its pvalue of 0.000. AGR and TSR also conform to the apriori of a positive relationship with economic growth. AGR increases growth by 1.38 percent while TSR contributes 0.76 percent to growth. AGR and TSR were both statistically significant given their p-values of 0.000 and 0.054, all within the threshold of 0.05 threshold of significance. SMR also conforms to the apriori of a positive relationship with economic growth. It contributes 0.99 percent to growth and was significant at the p-value of 0.000. Further, the results show a D.W statistic of 2.1, which indicates no autocorrelation. The study therefore concludes that non-oil revenue is a positive driver of the economic growth in Nigeria between the years 1986 - 2023. The study therefore recommends Increase investment on agriculture by the government through the provision of agricultural inputs such as fertilizers, herbicides, loan facility to farmers, and farm machineries that will enhance agricultural productivity and hence increased the revenue collection from the sector among others. Keyword: Non-oil Revenue, Economic Growth, Relationship

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