ABSTRACT

The study investigates the effect of government expenditure on economic

growth of Nigeria from the period 1995-2016. Government expenditures are very

crucial instruments for economic growth at the disposal of policy makers in developing

countries like Nigeria. The objective was set to determine the relationship between

capital, recurrent and health expenditure and economic growth of Nigeria and to address

the problem of utilization of revenue targeted to improving the

economic condition of Nigeria. The review of theoretical and empirical

literature provided a basisfor the selection and specification of model which

was used to show if government capital and recurrent expenditure has positi

ye or negative impact on economic growth. The study used Ex-post facto research

design and applied time series econometrics technique to examine the long and short run

effects of government expenditure on economic growth in Nigeria. The data

were got from CBN statistical bulletin. All the research questions were analyzed

using mean and standard deviation and the entire null hypotheses were tested using simple

linear regression at 0.05 level of significant. The results revealed that relationship exist

between capital, recurrent and health expenditure on economic growth of Nigeria and there

were positive relationship with capital, recurrent and health expenditure on economic growth

of Nigeria. Based on the findings it was recommended that Government

expenditure implementation programs should be put in place. More incentives should be

given to agriculture, education and health since they covered the larger population in

economy.