Fiscal Policy Tools, Employment Generation and Sustainable Development in Nigeria

Olukayode E. Maku () and Olorunfemi Alimi
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Olukayode E. Maku: Olabisi Onabanjo University

Acta Universitatis Danubius. OEconomica, 2018, issue 14(3), 186-199

Abstract: This study investigates the impact of fiscal policy instruments on employment generation in Nigeria within the periods of 1980-2015. The study used the Augmented Dickey Fuller test to estimate the stationarity level, Engel Granger cointegration test for long-run relationship and ordinary least square for long-run estimates. The findings show that government spending and manufacturing output had negative impact on unemployment rate in Nigeria. It suggests that government spending and output from manufacturing industry reduce unemployment rate in Nigeria. However, tax revenue and agricultural output have direct impact on unemployment rate in Nigeria. The findings suggest that government expenditure has the potential of creating more jobs if they were expended on appropriate capital projects that are capable of facilitating employment creation and linking rural-urban centres smoothly and not encouraging migration. Manufacturing sector also has the prospect of alleviating jobless growth, likewise the agriculture sector if policies are targeted at raising their outputs.

Keywords: Tax; government expenditure; unemployment rate; agriculture; manufacturing (search for similar items in EconPapers)
Date: 2018
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