Effect of Cost of Governance on Economic Growth of Nigeria

Abstract

The study investigated the effect of cost of governance on economic growth in democratic dispensation in Nigeria. The variables of cost of governance are broken into general administration, defense, internal security and national assembly and used as the explanatory variable while GDP served as the dependent variable and proxy for economic growth. The study covered the civil rule in Nigeria forth republic of 1999 to 2014. Diagnostics test and Ordinary Least Square regression was carried out. The results show that cost of general administration (8.67 GA), defence (169.99 national assembly (496.50 NAS) have positive effect while internal security (-106.17 ISEC) effect on GDP. The summary of the hypotheses indicated that (1) federal government cost of general administrations has no positive significant effect on economic growth in Nigeria; (2) federal government cost of defense has positive significant effect on economic growth in Nigeria; (3) ffederal government cost of internal security has negative significant eff on economic growth in Nigeria; and government cost of national assembly has positive significant effect on economic growth in Nigeria. Among others, the study recommended that spent on internal security should to investigated and cost-benefit analyses should be carried out on the parastatals that receive the proceeds of internal security.