FISCAL POLICIES AND STANDARD OF LIVING IN NIGERIA: INVESTIGATING THE TREND 1980 - 2016

Authors

  • Itoro Moses IKOH University of Uyo

Keywords:

Fiscal policy, Standard of living, New Growth Theory (NGTs),

Abstract

This paper assessed the impact of Nigeria’s fiscal policies on standard of living using data obtained from the Central Bank of Nigeria (CBN) and the Nigeria Bureau of Statistics (1980 – 2016). Eight variables including Per Capita Income (PCI), Consumer Price Index (CPI), Level of Education (EDL), Gross Capital Formation (GCF), Gross Domestic Product (GDP), Labour Force (Proxy for Employment) (LABF), Population Growth (POPG), and Terms of Trade (TOT) were included in the study. Per-Capita income (proxy for standard of living) was used as the dependent variable. The Fully Modified Least Square method used to predict the impact of the independent variables on the independent variable revealed that the gross domestic product (GDP) had a significantly positive impact on per capita income. Similarly, the Labour Force (Proxy for Employment) suggests that increasing employment had positively and significantly impacted on standard of living. However, government expenditures on human capital development and knowledge did not exert significant impact on standard of living during the period under review. Additionally, the Consumer Price Index (CPI) though positive, was statistically insignificant for the model. The Gross Capital Formation (GCF) and Population Growth (POPG) were not only insignificant, but also exerted negative effect on the standing of living. Based on these findings, the study recommended among others that Government should design fiscal policy that would place emphasis on investment in knowledge and human capital with time line on target achievement, and invest more on education and in so doing encourage research on technological development.

Author Biography

Itoro Moses IKOH, University of Uyo

Department of Banking and Finance, Faculty of Business Administration, University of Uyo, Akwa Ibom State, Nigeria.

Published

2019-04-01