The impact of government debt on economic growth in Nigeria

Artikel

This study investigated the effect of government debt on Nigeria's economic growth using annual data from 1980 to 2018 and the Autoregressive Distributed Lag technique. The empirical results showed that external debt constituted an impediment to long-term growth while its short-term effect was growth-enhancing. Domestic debt had a significant positive impact on long-term growth while its short-term effect was negative. In the long term and short term, debt service payments led to growth retardation confirming debt overhang effect. The findings suggested that the government should direct the borrowed funds to the diversification of the productive base of the economy. This will improve long-term economic growth, expand the revenue base and strengthen the capacity to repay outstanding debts when due. Fiscal improvements that encourage domestic resource mobilization, efficient debt management strategies and reliance on domestic debt rather than external debt for increased deficit financing to engender greater growth are the main contribution of the study.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Cogent Economics & Finance ; ISSN: 2332-2039 ; Volume: 9 ; Year: 2021 ; Issue: 1 ; Pages: 1-19

Classification and Topics

• Classification: Wirtschaft ; Economic Education and Teaching of Economics: Undergraduate ; Fiscal Policy ; Trade and Labor Market Interactions ; General Financial Markets: Government Policy and Regulation ; Tax Evasion and Avoidance
• Subject: ARDL cointegration ; Debt overhang ; Debt servicing ; Economic growth ; Government debt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Yusuf, Abdulkarim ; Saidatulakmal Mohd
• Event: Veröffentlichung
• (who): Taylor & Francis
• (where): Abingdon
• (when): 2021

Further information

• DOI: doi:10.1080/23322039.2021.1946249
• Handle: http://hdl.handle.net/10419/270116
• Last update: 10.03.2025, 11:42 AM CET