Economic Analysis of Capital Expenditure and Infrastructural Development in Nigeria. (June 2018)

• Record Type: Journal Article
• Authors: Okolo, Chukwuemeka Valentine; Edeme, Richardson Kojo; Emmanuel, Chinanuife
• Is Part Of: Journal of infrastructure development. Volume 10:Number 1/2(2018)
• Page Start: 52
• Page End: 62
• Publication Date: 2018-06
• Subjects: Capital expenditure -- infrastructural development -- recurrent expenditure -- public debt -- autoregressive distributed lag model; Infrastructure (Economics) -- Periodicals; City planning -- Periodicals; Economic development -- Periodicals; 363.05
• DOI: 10.1177/0974930618809173
• Languages: English
• ISSNs: 0974-9306

Abstract

Infrastructural development has been the major concern of countries all over the world due to its significant impact in fostering growth. In Nigeria, it has been observed that the level of infrastructure posed serious threat to attaining sustained growth. This study therefore examines the impact of capital expenditure on infrastructural development in Nigeria, utilising time series from 1970 to 2017. The study adopted autoregressive distributed lag (ARDL) model due to the possibility of the past value of the dependent variable explaining its present value, and found that capital expenditure, construction expenditure and non-oil revenue have the potency of accentuating infrastructural development in the long-run but such is being hampered by external debt. The positive effect of recurrent expenditure on infrastructural development is a pointer that bulk of the expenditure in Nigeria over the years is recurrent in nature. These suggest the need to boost non-oil revenue, reduce recurrent and channel external debt into productive infrastructural development.