DETERMINANTS OF PUBLIC EXPENDITURE ON GOVERNMENT EXPENDITURE IN NIGERIA

Abstract

This study examined the determinants of public expenditure on government expenditure in
Nigeria. The specific objectives are to: determine the effect of public debt growth on total
government expenditure growth in Nigeria, ascertain the effect of total revenue growth on
total government expenditure growth in Nigeria, evaluate the effect of inflation rate on total
government expenditure growth rate in Nigeria, examine the effect of exchange rate on total
government expenditure growth rate in Nigeria, and compare the democratic eras on
government expenditure growth in Nigeria. Time series data were extracted from the
publications of Central Bank of Nigeria (CBN) Annual Reports and National Bureau of
Statistics (NBS) bulletin, Budget Office of the Federation from 2008 to 2022 to cover the
two immediate past era of governance. The hypotheses were tested using pool multiple
regression analysis. The study revealed that public debt and exchange rate were statistically
significant at 5% level of significance, while total revenue and inflation rate shows negative
and positive insignificant effect respectively. Consequently, the study recommended that
government should enhance its expenditure on productive and fecund activities in order to
increase the total output of the economic system as this has a tendency to lessen the charge
of inflation in the financial system in preference to exacerbate it.