Effect of government experience on education and health: Implications on economic growth of Nigeria 1981-2021

Abstract

This study analyzed government expenditure and economic growth of Nigeria for the period 1981-2021. Government expenditure was proxied with expenditure on education, health, social and community services while government total investment and net foreign trade were included as the intervening variables. Economic growth was proxied with gross domestic product. The data were analyzed using econometric procedures particularly the Auto regressive Distributed Lag (ARDL) model. The results showed that in the short run, government health expenditure exerted positive relationship with GDP which was not significant while education expenditure exerted significantly negative effect on the economy. The long run analysis revealed that government education expenditure had negative significant effect on GDP while health expenditure had positive significant effect on GDP. The intervening effects of social and community services expenditure and investment were positive but not significant while net foreign trade exerted negative effect in the model. The study concluded that government expenditure have not been appropriately channeled towards the education sector despite the amount spent on recurrent and capital expenditures to education whereas health expenditure increased growth in the economy significantly. It was recommended that government should increase budget allocations to education sector and also encourage private stake holders to invest in the education sector as well as engaging in foreign partnership in funding the health sector.