Public Debt and Economic Growth in Nigeria
Journal Title: Asian Research Journal of Arts & Social Sciences - Year 2017, Vol 4, Issue 3
Abstract
This study empirically analyzed the relationship between public debt and economic growth in Nigeria from 1980-2015. The study adopted Vector Error Correction Model (VECM) approach of econometric data analysis. The variables used in the study include real gross domestic product (RGDP), foreign debt, domestic debt and domestic private savings. The results of the study indicated that: (i) External debt have significant negative impact on economic growth within the period under study. (ii) Domestic debt (DMD) has significant negative relationship with economic growth within the period under consideration. (iii) External debt and domestic debt granger cause RGDP in Nigeria with causality running from external debt and domestic debt to RGDP. The implication of this result is that the negative correlation between debt stocks (external debt and domestic debt) and economic growth which is contrary to apprior expectation may be highlighting the misappropriation and wrong application (corrupt practices) of the borrowed funds. Based on findings, the study recommends therefore that (i) Government should reduce external debt and the ones obtained should be strictly used for purposes intended to ensure positive effect. (ii) Government should cut down on domestic borrowing and ensure that the already borrowed funds are applied for purposes intended to ensure positive effect and through growth. (iii) With the evidence of negative causality running from both external and domestic debt stock to economic growth (RGDP) suggests that government should cut down in both borrowings to ensure economic stability and sustainable growth.
Authors and Affiliations
Elom-Obed Ozioma Favour, Odo Stephen Idenyi, Elom Obed Oge, I. Anoke Charity
Keywords
Related Articles
- EP ID EP338641
- DOI 10.9734/ARJASS/2017/36095
- Views 76
- Downloads 0
Corruption and the Challenge of Boko Haram Terrorism in Nigeria: A Case of the Nigerian Armed Forces
The study examines the extent to which corruption in the Nigerian armed forces has been able to undermine the fight against Boko Haram terrorism in Nigeria. The study relied on the qualitative content analysis of seconda...
Comparative Study of the Predictors of Socio Economic Status between Manipuri and Khasia Ethnic Communities in North Eastern Region of Bangladesh
The objective of the study is to find out the predictors of the socio-economic status of the ethnic community (Manipuri and Khasia) in Bangladesh. The study analyzed a total of 113 (82 Manipuri & 31 Khasia) respondents f...
Influence of Demographic Factors and Pay Satisfaction on Career Satisfaction among Selected Employees in Redeemer’s University
This study explores the influence of demographic factors and pay satisfaction and on career satisfaction among selected employees of Redeemer’s University, Osun State, Nigeria. The study adopted a cross sectional survey...
Work-related Threats in Timber Sheds within Makurdi Metropolis, Benue State, Nigeria
This study assessed work-related threats in timber sheds within Makurdi Metropolis, Benue State. For the purpose of this study, four major timber sheds were purposively sampled and visited out of six located in Makurdi....
Analysis of the Arguments Presented in Response to the Allegations against an Online Education Website
This paper aims to analyze the arguments in an article written by an online education website in response to accusations of fraud and misconduct levelled in another article published by a popular news magazine. This pape...