2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria
| Format: | General Document |
|---|
| _version_ | 1860798273304920064 |
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| building | INTELEK Repository |
| collection | Online Access |
| collectionurl | https://intelek.unisza.edu.my/intelek/pages/search.php?search=!collection3 |
| copyright | Copyright©PWB2025 |
| country | Malaysia |
| date | 2025-07-14 16:11 |
| format | General Document |
| id | 16758 |
| institution | UniSZA |
| originalfilename | THE LINK BETWEEN GOVERMENT EXPENDITURE AND FINANCIAL DEVELOPMENT ON ECONOMIC GROWTH IN NIGERIA (MASTER 2015).pdf |
| person | Ahmad Usman Gambo |
| recordtype | oai_dc |
| resourceurl | https://intelek.unisza.edu.my/intelek/pages/view.php?ref=16758 |
| sourcemedia | Server storage Scanned document |
| spelling | 16758 https://intelek.unisza.edu.my/intelek/pages/view.php?ref=16758 https://intelek.unisza.edu.my/intelek/pages/search.php?search=!collection3 General Document Malaysia Library Staff (Top Management) Library Staff (Management) Library Staff (Support) Terengganu Faculty of Business and Management English application/pdf 1.6 Nigeria 125 Server storage Scanned document Universiti Sultan Zainal Abidin UniSZA Library Access Universiti Sultan Zainal Abidin Economic Growth Copyright©PWB2025 Financial Development Dissertations, Academic Adobe Acrobat (64-bit) 25 Paper Capture Plug-in with ClearScan Ahmad Usman Gambo Government Expenditure Government spending—Nigeria Finance—Nigeria Economic development—Nigeria Economic policy—Nigeria 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria Government expenditure and financial development among other things can be used to achieve the economic growth of a country. As such, this study attempts to propose a framework that determine the impact of government expenditure and financial development on economic growth; identify the long-run and short-run relationships between government expenditure, financial development and economic growth and direction of causality among these variables. The study used annual time series data in Nigeria for the period 1970-2012. In proposing the framework that determine the impact of government expenditure and financial development on economic growth, we first employed a Principal Component Analysis to develop Financial Development Index, and two cointegration tests were employed (i.e. ARDL bound test and Johansen-Mosconi-Nielsen test) to test the long-run relationship among the variables. Autoregressive distributive lag with error correction model (ARDL-ECM) are employed to identify the long-run and short-run relationships between government expenditure and financial development. Finally, linear and non-linear Granger causality tests are used to test the direction of causality. The findings of the study revealed that there is a long-run relationship between government expenditure, financial development and economic growth in both approaches of cointegration. This suggests that, with proper government expenditure and effective financial sector, the macroeconomic problems will be solved. However, the ARDL-ECM estimates indicates that financial development is the only variable that has significant impact on economic growth in both the long-run and short-run. This implies that, the financial sector development contributes more to the economic growth. Furthermore, the Granger causality test indicates unidirectional causality running from government expenditure to economic growth and from financial development to economic growth. Meanwhile, the Dicks and Panchenko nonlinear Granger causality test show unidirectional causality among government expenditure and financial development on economic growth. This indicates that, government expenditure and financial development are the causes of economic growth in Nigeria. The study therefore, recommends that government needs to cut down its recurrent expenditure and increases it capital expenditure. Moreover, government should ensure that all funds appropriated are used for such purposes. Lastly, government should come up with a new financial policy that will enable private sectors to have long-term loan with a single digit interest rate. 2025-07-14 16:11 uuid:adf395f4-5c23-4c6c-8e3f-125e31e9da65 THE LINK BETWEEN GOVERMENT EXPENDITURE AND FINANCIAL DEVELOPMENT ON ECONOMIC GROWTH IN NIGERIA (MASTER 2015).pdf ARDL Model Nigeria Economy Financial Sector Government spending policy—Nigeria Financial institutions—Nigeria Thesis |
| spellingShingle | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| state | Terengganu |
| subject | Dissertations, Academic Government spending—Nigeria Finance—Nigeria Economic development—Nigeria Economic policy—Nigeria Government spending policy—Nigeria Financial institutions—Nigeria |
| summary | Government expenditure and financial development among other things can be used to achieve the economic growth of a country. As such, this study attempts to propose a framework that determine the impact of government expenditure and financial development on economic growth; identify the long-run and short-run relationships between government expenditure, financial development and economic growth and direction of causality among these variables. The study used annual time series data in Nigeria for the period 1970-2012. In proposing the framework that determine the impact of government expenditure and financial development on economic growth, we first employed a Principal Component Analysis to develop Financial Development Index, and two cointegration tests were employed (i.e. ARDL bound test and Johansen-Mosconi-Nielsen test) to test the long-run relationship among the variables. Autoregressive distributive lag with error correction model (ARDL-ECM) are employed to identify the long-run and short-run relationships between government expenditure and financial development. Finally, linear and non-linear Granger causality tests are used to test the direction of causality. The findings of the study revealed that there is a long-run relationship between government expenditure, financial development and economic growth in both approaches of cointegration. This suggests that, with proper government expenditure and effective financial sector, the macroeconomic problems will be solved. However, the ARDL-ECM estimates indicates that financial development is the only variable that has significant impact on economic growth in both the long-run and short-run. This implies that, the financial sector development contributes more to the economic growth. Furthermore, the Granger causality test indicates unidirectional causality running from government expenditure to economic growth and from financial development to economic growth. Meanwhile, the Dicks and Panchenko nonlinear Granger causality test show unidirectional causality among government expenditure and financial development on economic growth. This indicates that, government expenditure and financial development are the causes of economic growth in Nigeria. The study therefore, recommends that government needs to cut down its recurrent expenditure and increases it capital expenditure. Moreover, government should ensure that all funds appropriated are used for such purposes. Lastly, government should come up with a new financial policy that will enable private sectors to have long-term loan with a single digit interest rate. |
| title | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| title_full | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| title_fullStr | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| title_full_unstemmed | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| title_short | 2015_The Link Between Government Expenditure and Financial Development On Economic Growth In Nigeria |
| title_sort | 2015_the link between government expenditure and financial development on economic growth in nigeria |