An Empirical Investigation of Public Debt and Economic Development in Nigeria

Ugochi Ann Ihejirika, Ijeoma Emele Kalu and Sylvester Udeorah
Additional contact information
Ugochi Ann Ihejirika: International Trade and Development, University of Port Harcourt, Port Harcourt, Nigeria.
Ijeoma Emele Kalu: Department of Economics, University of Port Harcourt, Port Harcourt, Nigeria.
Sylvester Udeorah: International Trade and Development, University of Port Harcourt, Port Harcourt, Nigeria.

Post-Print from HAL

Abstract: The study empirically investigated public debt and economic development in Nigeria from 1981 to 2020. In specific terms, the study investigated the effect of domestic debt and external debt on economic development. The measure of economic development chosen for the study was per capita income. We obtained the data for this study from secondary sources which include World Bank World Development Indicator (WDI), United Nations Conference on Trade and Development (UNCTAD) and Central Bank of Nigeria (CBN) Statistical Bulletin. The statistical tools of unit root, cointegration and autoregressive distributed lag (ARDL) method were used in analyzing the data. With secondary data, the variables are found to be of mixed order of integration and, therefore, the ARDL model is the parameter estimator. Our cointegration result verified long run relationship exist among the domestic debt, external debt, population growth, debt, servicing, investment and economic development. The empirical result of the ARDL estimation showed that domestic debt had positive sign and significant with economic development in the long run. Again, investment and population are both positive and had significant effect on economic development in the long run. Also, external debt and debt servicing had insignificant effect on economic development. Thus, the study concluded that, domestic borrowing, investment spending and population growth are the major factors affecting economic development in Nigeria. The findings suggest that fiscal authorities should fund development projects using domestic borrowing and encourage investment in the productive industries through the design and implementation of structural policies.

Date: 2022-11-12
References: Add references at CitEc
Citations:

Published in Asian Journal of Economics, Finance and Management , 2022, 4 (1), pp.494-503

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05149914

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().