IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 6 NO. 1 2021

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Poverty, Inequality and Economic Growth in Nigeria between 1985 – 2020

Omolua, Roy Oshiokpekhai & Tamunowariye, Chinonso

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Abstract

This study examines the impact of poverty, income inequality on economic growth in Nigeria from 1985 to 2020. Poverty rate, Gini coefficient and inflation rate were used as independent variables while real gross domestic product (RGDP) as dependent variable. Annual time series data on our targeted variables were obtained from secondary sources including the Central Bank of Nigeria annual statistical bulletin, World Bank development indicators (various years). The Eview9 Statistical Software was employed to analyze the data empirically. The Unit root test shows that real gross domestic product, poverty rate, gini coefficient and inflation rate variables to be evaluated are all stationary after first deference I(1). The data were analyzed using the Autoregressive distributed lag (ARDL). From the results of the ARDL estimates it was revealed that among others, Gini coefficient and inflation rate coefficient impact negatively on Real gross domestic product while poverty rate coefficient has a positive relationship with real gross domestic product (RGDP). It was also observed that all the variables were statistically significant at 5% level of significance. The study recommended among others that The Nigerian government should make frantic and deliberate effort to enforce policies and schemes that would improve human capital through education especially in the rural areas. The government should also pursue expansionary fiscal policies that are geared towards educational schemes and programmes so that the poor masses could acquire skills to better their lot which in turn would lead to economic growth. And there should be proper monitoring strategy to ensure that funds provided for such schemes and programmes are not embezzled or misappropriated by government officials.

keywords:

Poverty rate, Income inequality, Inflation, Economic growth, Nigeria

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