IIARD International Institute of Academic Research and Development

Journal of Accounting and Financial Management (JAFM )

E-ISSN 2504-8856
P-ISSN 2695-2211
VOL. 10 NO. 6 2024
DOI: 10.56201/jafm.v10.no6.2024.pg1.10

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Effect of Federal Government Revenue on Economic Growth in Nigeria: 1981 – 2022

Ejinkonye, Remigius Chinwoke (PhD), Mazeli, Edith Nkiruka (PhD), Adiga, Dauda Leviticus (PhD), Nwosu, Samuel N. (PhD).

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Abstract

This study assessed the effect of government revenue on economic growth in Nigeria. Background: Government revenue refers to funds accruing to and received by the government. The economic growth of a nation will be driven by its ability to not only generate adequate revenue but also its effective utilization. It seems we are not seeing a growth pattern that is commensurate to the high government revenue generation in Nigeria may be due to poor management, improper use of funds. Aims: The specific objectives were: (1) To assess the effect of oil revenue on gross domestic product in Nigeria (2) To examine the effect of non-oil revenue on gross domestic product in Nigeria. Methods: The study was anchored on the endogenous growth theory of Harrod-Domar. The ex-post facto research design was employed and data from 1981 to 2022 obtained from Central Bank of Nigeria statistical bulletin. The descriptive statistics, ADF unit root test and OLS technique were used to analyze the data. Results: (1) Oil revenue had a positive (0.371649) and non-significant effect (0.5455) on GDP in Nigeria (2) Non-oil revenue had a positive (28.13902) and significant effect (0.0000) on GDP in Nigeria. There is no unit root, the probability (f-statistic) value was 0.000000 while adjusted R2 value was 0.979736. Conclusion: The study showed that oil revenue and non-oil revenue positively contributed to economic growth of Nigeria for the period reviewed. Hence, these variables are determinants of economic growth in Nigeria.

keywords:

Economic growth; oil revenue; non-oil revenue; government

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