International Journal of Science and Research (IJSR)

International Journal of Science and Research (IJSR)
Since Year 2012 | Open Access | Fully Refereed | Peer Reviewed

ISSN: 2319-7064




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Research Paper | Management | Nigeria | Volume 4 Issue 6, June 2015


Capital Expenditure at Disaggregated level and Economic Growth in Nigeria: An Empirical Analysis

Gabriel Chukwu Nkechukwu | Johnson Ifeanyi Okoh


Abstract: The main objective of this paper is to examine the partial and joint effects of disaggregated capital expenditures on economic growth in Nigeria. The study is perceived on the causal effect between government expenditure and economic growth. Annual time-series data coverage 1981-2013 for capital expenditure on education, health, agriculture and road construction were analyzed using ordinary least square multiple regression model to predict economic growth. The Data were obtained from the Central Bank of Nigeria Statistical Bulletin. Cointegration and VECMs were applied in estimating the data to test the long-run and short-run effect of the variables on the economic growth. Granger-causality tests were conducted to ascertain the cause-effect of the variables. Results indicate there exists long-run positive relationship between economic growth and capital expenditure on education and road, while there is long-run negative relationship between economic growth and capital expenditures on agriculture and health. Results also indicate there is unidirectional causal effect running from economic growth to capital expenditure on agriculture and road construction, while at the same time a unidirectional causal effect runs from capital expenditures on education and health to economic growth. The adjusted R2 is 33 % indicating that greater proportion of the issues in economic growth is not explained by capital expenditure in Nigeria. Recommendation is that government should review its monitoring mechanism to ensure adequate and prudent management of funds.


Keywords: Capital expenditure, economic growth, multiple regression model and Nigeria


Edition: Volume 4 Issue 6, June 2015,


Pages: 729 - 737


How to Cite this Article?

Gabriel Chukwu Nkechukwu, Johnson Ifeanyi Okoh, "Capital Expenditure at Disaggregated level and Economic Growth in Nigeria: An Empirical Analysis", International Journal of Science and Research (IJSR), Volume 4 Issue 6, June 2015, pp. 729-737, https://www.ijsr.net/get_abstract.php?paper_id=2061502

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