Oil Revenue and Economic Growth in Nigeria: An Empirical Analysis
EKEZIE, Wisdom Uchenna, PRO F ABU, Maji, MAMMAN, Andekujwo Baajon
Abstract
Oil revenue is a significant component of Nigeria’s economy since the last five decades after displacing agriculture, accounting for a large portion of the government revenue and export earnings, thereby becoming both blessing and curse. This study examined the impact of oil revenue on economic growth in Nigeria. It spanned through the period 1986 to 2024. The specific objectives are to evaluate the impact of crude oil export earnings, domestic crude oil sales, petroleum profit tax, oil royalties, on real gross domestic product in Nigeria. And also, ascertain whether the exchange rate moderates the impact of oil revenue on economic growth in Nigeria. The study employed an ex post facto research design and the secondary data used for the investigation were sourced from the Central Bank of Nigeria (CBN) statistical bulletin, National Bureau of statistics, Federal Inland Revenue Service (FIRS) Fact Book and the World Bank Development Website. Descriptive Statistics, Augmented Dickey-Fuller (ADF), ARDL bound test for Co-integration and Autoregressive Distributed lag model (ARDL) Statistical tools were used in the study. The results revealed that Crude oil export earnings have significant and positive impact on the real gross domestic product in Nigeria; Domestic crude oil sales have an insignificant but positive impact on real gross domestic product in Nigeria; Petroleum profit tax has a positive and insignificant impact on real gross domestic in Nigeria; Oil royalties have a significant and positive impact on real gross domestic product in Nigeria; The study concluded that oil revenue has a positive and significant impact on the economic growth of Nigeria. The study recommends that the government should utilize crude oil export earnings to invest in infrastructural projects that will help promote economic expansion and alleviate poverty in the country, engage in resuscitating the local refineries in Nigeria to encourage and incr
Keywords
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