Abstract

This study investigated Fiscal policy and economic growth in Nigeria for a period of forty five years 1970 to 2014. The objective is to determine the impact of Fiscal policy on economic growth in Nigeria. The study used Ex-post facto research design and time series data (1970-2014) sourced from National Bureau of Statistics (NBS) annual bulletin, Central Bank of Nigeria (CBN) annual bulletin, World Bank Country economic statistics and Central Intelligence of America Countries Economic statistics. Ordinary least squares of multiple regressions were used to test the formulated hypotheses and to ascertain the stationarity of the data used the Augmented Dickey Fuller test was conducted.  The Engle-Granger co-integration and the Error correction models were used to test for the short and long run dynamic behavioral relationship of the variables.  The study also showed that most of the explanatory variables were not significance in contrast with the a priori expectations. It was also found out that Nigerian aggregate public expenditure if not properly managed could cause real gross domestic product, the proxy for economic growth to reduce by 28.05%. It was also showed that Nigeria aggregate public expenditure has no significance on the growth of Nigeria economy. Also showed was that Nigerian public recurrent expenditure was negative, insignificant and had no impact on the economic growth of Nigeria. It was revealed that Nigerian public capital expenditure was significant, positive and could impact on the growth of Nigeria economy. The impact of Nigeria aggregate public expenditure on economic growth in Nigeria was found to be  insignificant. In view of the findings and conclusion the Researcher recommends that the Nigerian economic fiscal policy makers should formulate policies that would encourage other sources of revenues and expenditures. The researcher recommended that government should embark upon an aggressive implementation of the Nigerian expenditures budget in order to drive to a greater height the Nigerian economy as to better the economic conditions of the people of Nigeria.