IDEAS home Printed from https://ideas.repec.org/a/hur/ijarbs/v5y2015i2p287-301.html
   My bibliography  Save this article

Behavioral Pattern of Fiscal Policy Variables and Effects on Economic Growth: An Econometric Exposition on Nigeria

Author

Listed:
  • Mohammed Ismaila
  • Lawrence Ehikioya Imoughele

Abstract

The rationale of this study is to examine the effect of fiscal policy variables on economic growth in Nigeria. The fiscal policy variables considered in the study include government gross fixed capital formation, tax, government expenditure, budget deficit as well as external debt. The study covered the period 1986 to 2012. Unit roots of the time series were examined using the Augmented Dickey-Fuller technique after which the co-integration test was conducted using the Johansen Co-integration Approach. Error-correction models were estimated to take care of short-run dynamics. Over all, the results indicate that fiscal policy has a long-run relationship with Nigeria economic growth confirmed by the co-integration test. the study further reveals that government expenditure and gross fixed capital formation from government has positive and significant impact on Nigeria economic growth while budget deficit has negative and significant effect on Nigeria economic growth and concluded that that fiscal policy has the ability to induced economic growth in Nigeria through government expenditure and investment in the economy while ensuring that fiscal discipline are practised by keeping to budgetary provisions and minimising budget deficit.

Suggested Citation

  • Mohammed Ismaila & Lawrence Ehikioya Imoughele, 2015. "Behavioral Pattern of Fiscal Policy Variables and Effects on Economic Growth: An Econometric Exposition on Nigeria," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 5(2), pages 287-301, February.
    • Handle: RePEc:hur:ijarbs:v:5:y:2015:i:2:p:287-301
    as

    Download full text from publisher

    File URL: http://hrmars.com/hrmars_papers/Behavioral_Pattern_of_Fiscal_Policy_Variables_and_Effects_on_Economic_Growth_An_Econometric_Exposition_on_Nigeria2.pdf
    Download Restriction: no
    File URL: http://hrmars.com/hrmars_papers/Behavioral_Pattern_of_Fiscal_Policy_Variables_and_Effects_on_Economic_Growth_An_Econometric_Exposition_on_Nigeria2.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. anonymous, 1995. "Does the bouncing ball lead to economic growth?," Regional Update, Federal Reserve Bank of Atlanta, issue Jul, pages 1-2,4-6.
    2. Robert J. Barro, 2013. "Inflation and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 14(1), pages 121-144, May.
    3. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    4. Devarajan, Shantayanan & Swaroop, Vinaya & Heng-fu, Zou, 1996. "The composition of public expenditure and economic growth," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 313-344, April.
    5. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
    6. Xavier Sala-I-Martin, 1997. "Transfers, Social Safety Nets, and Economic Growth," IMF Staff Papers, Palgrave Macmillan, vol. 44(1), pages 81-102, March.
    7. Matthew Kofi Ocran, 2011. "Fiscal policy and economic growth in South Africa," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 38(5), pages 604-618, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nursini Nursini, 2017. "Effect of Fiscal Policy and Trade Openness on Economic Growth in Indonesia: 1990-2015," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 358-364.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Margit Schratzenstaller-Altzinger, 2007. "WIFO-Weißbuch: Wachstumsimpulse durch die öffentliche Hand," WIFO Monatsberichte (monthly reports), WIFO, vol. 80(6), pages 509-526, June.
    2. Martijn Brons & Henri L.F.M. de Groot & Peter Nijkamp, 1999. "Growth Effects of Fiscal Policies - A Comparative Analysis in a Multi-Country Context," Tinbergen Institute Discussion Papers 99-042/3, Tinbergen Institute.
    3. Norman Gemmell, 2001. "Fiscal Policy in a Growth Framework," WIDER Working Paper Series DP2001-84, World Institute for Development Economic Research (UNU-WIDER).
    4. Uche Boniface Ugwuanyi & Okelue David Ugwunta, 2017. "Fiscal Policy and Economic Growth: An Examination of Selected Countries in Sub-Saharan Africa," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 7(1), pages 117-130, January.
    5. Marie-Ange VEGANZONES-VAROUDAKIS, 2000. "Infrastructures, investissement et croissance : un bilan de dix années de recherches," Working Papers 200007, CERDI.
    6. Amal MATALLAH & Amal MATALLAH, 2017. "Does fiscal policy spur economic growth? Empirical evidence from Algeria," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(612), A), pages 125-146, Autumn.
    7. Hammed Adetola Adefeso, 2016. "Productive Government Expenditure and Economic Performance in sub-Saharan Africa: An Empirical Investigation," Zagreb International Review of Economics and Business, Faculty of Economics and Business, University of Zagreb, vol. 19(2), pages 1-18, November.
    8. Qiao, Baoyun & Martinez-Vazquez, Jorge & Xu, Yongsheng, 2008. "The tradeoff between growth and equity in decentralization policy: China's experience," Journal of Development Economics, Elsevier, vol. 86(1), pages 112-128, April.
    9. Itchoko motande Mondjeli mwa ndjokou, 2015. "Too much public expenditures, less economic growt," Economics Bulletin, AccessEcon, vol. 35(3), pages 1985-1991.
    10. Pavel Yakovlev, 2007. "Arms Trade, Military Spending, And Economic Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 18(4), pages 317-338.
    11. Mitra, Arup & Sharma, Chandan & Véganzonès-Varoudakis, Marie-Ange, 2016. "Infrastructure, information & communication technology and firms’ productive performance of the Indian manufacturing," Journal of Policy Modeling, Elsevier, vol. 38(2), pages 353-371.
    12. Jorge Martinez-Vazquez & Violeta Vulovic & Yongzheng Liu, 2011. "Direct versus Indirect Taxation: Trends, Theory, and Economic Significance," Chapters, in: Emilio Albi & Jorge Martinez-Vazquez (ed.), The Elgar Guide to Tax Systems, chapter 2, Edward Elgar Publishing.
    13. Rehme, Günther, 2014. "Endogenous (re-)distributive policies and economic growth: A comparative static analysis," Economic Modelling, Elsevier, vol. 40(C), pages 355-366.
    14. Taylor, Alan M., 1999. "Sources of convergence in the late nineteenth century," European Economic Review, Elsevier, vol. 43(9), pages 1621-1645, October.
    15. Aghion, Philippe & Akcigit, Ufuk & Cagé, Julia & Kerr, William R., 2016. "Taxation, corruption, and growth," European Economic Review, Elsevier, vol. 86(C), pages 24-51.
    16. Achille Flora & Roberta Arbolino, 2013. "Divari territoriali e politiche di sviluppo: lo squilibrio territoriale nella regione Campania," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2013(1), pages 55-85.
    17. repec:dgr:rugsom:99e60 is not listed on IDEAS
    18. Eda Özdiler Küçük, 2017. "Adapting Legal Culture: Legislation and Interpretation in Tax Law," European Journal of Economics and Business Studies Articles, Revistia Research and Publishing, vol. 3, ejes_v3_i.
    19. Horst Hanusch & Lekha S. Chakraborty & Swati Khurana, 2017. "Fiscal Policy, Economic Growth and Innovation: An Empirical Analysis of G20 Countries," Economics Working Paper Archive wp_883, Levy Economics Institute.
    20. MARTINS, Ana Paula, 2015. "Increasing Returns And Endogenous Growth: Market Size And Taste For Variety," Academica Science Journal, Economica Series, Dimitrie Cantemir University, Faculty of Economical Science, vol. 1(5), pages 3-33, June.
    21. Long, N.V. & Wong, K.Y., 1996. "Endogenous Growth and International Trade: A Survey," Working Papers 96-07, University of Washington, Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hur:ijarbs:v:5:y:2015:i:2:p:287-301. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Hassan Danial Aslam (email available below). General contact details of provider: http://hrmars.com/index.php/pages/detail/IJARBSS .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.