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Inventory Management Policy And Manufacturing Firms Performance In Nigeria (2011-2020)




This study holds that for the period under study, government expenditure has not significantly impacted the Nigerian economy. From the findings observed, when the economy is assessed from the angle of RGDP, the effect of TEDU, THEL, and TAGR is observed to be all insignificant, but positive; while TPDS is shown to have an also insignificant but negative effect. This further implies that TPDS have not supported economic growth (RGDP) in Nigeria. It also implies that TEDU, THEL and TAGR have been more efficient as they support economic growth (RGDP) – though at an insignificant level. Hence, this study holds that TEDU, THEL, TPDS and TAGR (as measures of government expenditure) exert mixed effects on economic growth (RGDP) in Nigeria.



1.1 Background of Study

Most developing countries of the world adapt government expenditure as the most important policy instruments for promoting growth and equitable distribution. It is widely acknowledged and most of these countries that government expenditure is used to improve technology, human capital and infrastructure necessary for growth and also provide the incentives and enabling environment promote private-sector investment in order to further growth.

In 1963, Keynes argued that the solution to economic depression is achieved by persuading the firms to invest through reduction of interest rates and government capital investment which include infrastructure is. Nowadays, the majority of industrialized and emerging Nations employ public spending to alter the composition of natural income improve income distribution and the resources allocation in desirable directions (world bank 2008). Through the government numerous initiatives and inventions with his Ministries and departments and agencies (MDAs), public sector spending has been rising in exponential terms. Although it is often believed that government expenditure particularly on social and economic infrastructure can promote growth funding search spending to provide necessary infrastructural teachers for the government can actually show growth.

In developing countries, for instance, the variation in government spending pattern is not only projected to guarantee establishment but also to spur economic growth and expand employment opportunities.  The scope and composition of government expenditure will determine the pace and direction of economic growth. (Taiwo & Abayomi 2011). According to Bhatia(2008), government Expenditure entails expenses incurred by the government in carrying out Capital projects. Government expenditure also refers to expenses incurred by the government for the maintenance of itself and provision of public goods and services and work needed to Foster economic growth and improve the welfare of its citizens.

Government expenditure is the government spending from revenue derived from tax, levies and other revenue sources. Government spending on various sectors (federal, state and local Government) have different effect on the economic growth. (Yusut etal 2015). Meanwhile the two divergent views on the discuss of government spending as stipulated in fiscal policy need to be mentioned.

The instrument of government expenditure is used to  achieve macro-economic objectives like full employment, price stability and sustained economic growth. The government also uses his expenditure to provide public  goods like education, health, agriculture, public debt service, infrastructures etc. Which helps reduce socio-economic imbalances. Muritala, Taiwo A. (2011), commented that government expenditure is a foreskin instruments that choose a valuable rule in controlling inflection, unemployment, depression,  the balance of payment Equilibrium and foreign exchange rate stability. Bingular, P. and Oyandunghan. J. ( 2020) states that government spending is used to raise aggregate demand in period of depression and unemployment, further stimulating employment and output. Although government influences in the economy does not  automatically guarantee stability. However, it reduces the rate of instability for instance, government  involved in the economy did not prevent  the oil shock of 1970s, the financial crisis of 2007, Nigeria economic recession of 2016 or the global recession of 2020. However government investment makes it easy for Nations to bounce back after the sharks.

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The role of government in the economy has become more relevant in developing countries where income, output and employment are low. This countries are characterized by internal and external imbalances and instability. Lack of social amenities, poor human development and high poverty rates, thus making government an essential agent of reducing the social-economic problems these countries faces.

Bingilar, P. and Oyadonghan J.(2020) also mention that developing country governments have embarked on various spending programs to achieve economic growth. Hence economic growth represents the expansion of a country gross domestic product (GDP). Growth means increase in economic activities. According to Todano(1995) citing Kuznets defined a country economic growth as a long-term rise in capacity to supply increasingly diverse economic grade its population, this growth capacity based on advances in technology and the institutional and ideological adjustment that is demand. Economic growth is an increase in income over time. It is a positive change in the level of production of goods and services over a certain period of time. Expenditure pattern of the government usually are categorized into recurrent and capital expenditure according to the flow chart of government block by (mord, 2010). The former correspondent to government purchase of current goods and services (known consumables, wages and salary, etc) while the later you would ideally include not merely investment in infrastructure (rails, schools hospitals etc) but also all other expenditure that might contribute to development. In other words, recurrent expenditure refers to financial at least necessary for the day-to-day running of government business, the capital expenditure on the other hand refers to investment outlet that increases the assert of the state. The large Quantum of funds injected into the economy by the Nigerian government to finance the reoccurrence and capital expenditure has therefore led to the increase in aggregate money supply without the corresponding stability of the macro-economic variable (employment, unemployment rate, interest rate, balance of payments, consumer index, growth domestic product etc. Julia and when you come out 2013 Cycles in2016. the major instrument by which the government can ensure an effective growth in economic activity are

  1. Expenditure that and used a firm or workers to produce certain goods and services.
  2. Regulation and control that Direct people performance or desist for economic growth to attend economic growth.

iii. Taxes that reduces private consumption or investment and thereby French resources for public expenditure.

1.2 Statement of the Problem

The Nigerian expenditure status has continuously past years from level of millions to many trillions of naira. Nigeria been among the developing Nations yet the increased government spending spending seems not to have results in real growth and progress. Furthermore there are indication that perform well. The microeconomic index including the balance of payments imports obligations inflation rate exchange rate and issues with national saving show that Nigeria has not done well in canonical full stop the growth of government expenditure in Nigeria according to buhari 1993 as cited by o guru 2009 is the little among the factors rising income level organisation of the population technology and innovative change in political and the real kratz structure and the productivity lag. The decline in government and in from 28 15.2 million 4 in 1978 to 2003 1.6 million in 1979 and from this in 1970 82 to 29 million in 1984 from non all roof cbn 1994 unlimited domestic saving narrowed the revenue base for hi Jackson public sector operations the results to borrowing for financing large government budgetary deficient listal macroeconomic problem as excessive just boarding both domestic and foreign high inflationary pressure is change rate of a operation and external imbalance. Public sector borrowing from the domestic credit market also tends to crowd out private sector investment adebisi 1999. Couple days is duplicated infrastructural especially roads and power supply that has led to the collapse of many Industries including high level of unemployment. At the new Dean of Millennium African in general and Nigeria in particular surface monumental development like low level of income characterized by Low per capita income inequality for health inadequate education and inadequate power agricultural facilities. All these are consequences of poverty in Nigeria present in Paradise the country is rich but the people are poor. Nigeria which is rich in land or a people and natural gas resources that Nigeria has been they lived with debt problem. The better reality of the Nigerian situation is not yet that the poverty line is getting worse by the day but more than 14 of Nigerian lives in condition of extreme poverty of less than 320 Mera Kuch belly provide for a quarter of the nutritional requirements for health living. Several empirical findings have also proven to be inconsistent. No concessions has been established on the exact relationship between government expenditure and economic growth empirical studies have produced divergent results full stuff for instant IB pyp 2020 find that government capital expenditure was University Hyundai related to real gross domestic product GDP in the short run and the long run full stop in study by Polo g CK and Andrew new 2014 shows inverse relationship between government expenditure and health and economic growth. Inconstancy you serve as a BB and a commode n&s my 2015 found out that none of the component of government expenditure and contributes to economic growth in the short run. Therefore it is imperative to examine for the the government expenditure and its effort on the economic growth in Nigeria.

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1.3. Objectives of the Study

The major objective of the study is to evaluate the effect of government expenditure on economic growth between 2001 to 2020. while the specific goals of the study include to;

  1. Assess the extent to which expenditure on education(EDU) a do affect economic growth.
  2. Examine the extent to which government expenditure on health(HLT) affect economic growth.
  3. Evaluate the extent to which public debt servicing(PDS) affect economic growth.
  4. Determine the efforts of government expenditure on agriculture(AGR) on income growth

1.4 Research questions

  1. Does government expenditure on education influence economic growth in Nigeria?
  2. What is the significant relationship between government expenditure on health and economic growth in Nigeria
  3. What is the significant relationship between government expenditure on public bus service
  4. That’s government expenditure on agriculture have statistic effort and economic growth in Nigeria

1.5 Hypothesis of the study

Ho:That government expenditure and education does not influence economic growth and Nigeria

Hi: that government expenditure and education influence economic growth in Nigeria

Ho: there is no significant relationship between government expenditure on health and economic growth in Nigeria.

Hi: there is significant relationship between government expenditure and health and economic growth in Nigeria.

Ho: there is significant relationship between government expenditure and on public debt servicing saving

Hi: where is no relationship between government expenditure and public debt servicing

Ho: that government expenditure on agriculture sure has statistic effect on economic growth in Nigeria

1.6.  Scope of the study

The content of this today exam is mainly relationship or efforts of government expenditure on economic growth of Nigeria for a period of 20 years region 2001 to 2020 it is the purpose of the study studies to examine the scope of Federal Government spending. This may seem a simple matter of accident of the expenditure of the various federal agencies. Government expenditure is not limited too managing finance it also Focuses on maintaining the proper infrastructure contributing to the National economy reducing unemployment ranging the financial pillars of the economy reducing unemployment managing the financial pillars of the economy operating the hygiene and cleanliness in the nation analyses task collection ensuring the burden of tax is not very high monitoring and enforcing the implementation of the financial and fiscal policy maintaining the confidence of the public at large etc.

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The dependent variable which is economic growth is crossed by a real gross domestic product LG dp132 don’t variable government expenditure proved by total government expenditure on education total government expenditure on health health then-22 government expenditure and public debt servicing tpds and total government expenditure and agriculture cagr. The independent variable we are selected because they are the core government expenditure variable that may have a direct nation ship with economic growth within the given Nigeria contest contest

1.7. Significance of the study

The findings of this study will be beneficiary and also in lighting at all level federal state and local government and how their spending activities if the dictionary and located and monitored would bring about a desirable level of economic growth it also seeks to make the general public aware of the spending operation of the government this will ensure effective and efficient resources utilisation by the government there by bringing Nigeria’s short-term and long-term Development Goals to reality. This rituals work will be useful addition to the existing study on the effort of government on economic growth however the study is different from previous studies in school and unlike other studies that examine the effort of the total government expenditure and economic growth this study looks at the dis-aggregated effort of government expenditure on economic growth and it is intended to be of relevance to policy decision-makers government investors members of the public etc

1.8. Limitation of the study

Financial constants inadequate funds hinders delegates data collection source affecting the free flow of this research work

10 constructions with an opportunity for this study was not indefinite has the researcher was constrained to the limited time frame specified for the study and also the pursuit of order academic works affect the time devoted in this work but this challenge was handled by the researcher buy currently planning to meet at time to carry out this study

Information constraints the researcher encountered different difficulties in sourcing relevant data for this study because some relevant data for the study we are not readily available to the researcher full-stop however in order to solve this challenge the researcher solicited help from senior colleagues and other interest services

Other academic obligation the researcher was in the most of focusing on this study and also paying attention to other academic obligations. But all situation was solved by the research by opportunity balance time from this study and other academic engagement.

  1. Operational definition of terms

Government: Is the continuous exercise of authority over and the performance of functions for a political unit.

Expenditure: Expenditure refers to payment made on liabilities in cured in exchange for goods and services.

Growth:  This refers as a process of transformation

Government expenditure: This refers to expenses in cured by the government for the maintenance of itself and provision of public goods services and works needed to Foster or promote economic growth and improve the welfare of people in the society

Economic Growth: Economic growth is an increase in output or income over time it is a positive change in the level of production of goods and services over certain period of time.

Fiscal Policy: Fiscal policy is the use of government spending and tax policy to influence economic conditions, especially macro-economic conditions, including aggregate demand for goods and services, employment inflation and economic growth.

Pages:  58

Category: Project

Format:  Word & PDF               

Chapters: 1-5                                          

Source: Imsuinfo

Material contains Table of Content, Abstract and References.


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