Effects Of Public Sector Capital Budgeting On Unemployment Ad Inflation Level In Akwa Ibom State

ABSTRACT

Unemployment and inflation are two macroeconomic variables that are the primary fiscal policy target through public sector capital budgeting. However, the budgetary impact on both variables produces contrasting macroeconomic effects which poses a fiscal policy dilemma. This study was therefore undertaken to empirically ascertain the effect of public sector capital budgeting on unemployment and inflation level in Akwa Ibom State. The research made use of primary data to support the statistical analysis. The primary data was collected from questionnaires that were administered through a field survey. The data were analyzed using descriptive statistics regression and ,correlation analysis. The empirical results indicated that unemployment and inflation level were increasing and significant functions of public sector capital budgeting, and there was a positive and signfIcant relationship between unemployment and inflation level. It was recommended that fiscal policy thrust on unemployment and inflation should be clearly defined in budgetary planning process, there should be a strict implementation of the capital budget to avoid leakages, and a strict budgetary control process and variance correction mechanism built into the budget implementation process.