Public Debt and Economic Development in Nigeria: Impact
Assessment

Edward Chinedum F.; Amadi Jeff Chizuru

doi:10.56201/ijefm.v9.no5.2024.pg24.43

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Public Debt and Economic Development in Nigeria: Impact Assessment

Edward Chinedum F. and Amadi Jeff Chizuru

Abstract

This study investigated the nexus between public debt and development of the Nigerian economy for the period 1990-2021. Treasury bills outstanding, treasury bonds outstanding, multilateral debt and bilateral debt were the classes of public debt considered while human development index (HDI) was used as a surrogate to measure the performance of the Nigerian economy. Data for the study were secondarily sourced from the statistical bulletin of the CBN (Central Bank of Nigeria), 2021 edition and the World Bank. The sourced data were exposed to descriptive analysis, unit root/stationarity test, ARDL and ECM estimations, co-integration analysis, and diagnostic tests which basically tested for the presence of autocorrelation, multicollinearity and heteroscedasticity. Amongst of other things, results revealed that in the short and long run, treasury bills, treasury bonds and bilateral debts have positive effects on HDI in Nigeria while only multilateral debs has a negative influence on HD in the country. However, none of these components of public debt has a significant relationship with human development index in Nigeria for the period considered. On these premise, it was deduced that there has been a positive but insignificant nexus between public debt and economic development in Nigerian over time. Hence the suggestion that to make public debt contribute significantly to the economic development in Nigerian, there is need to ensure that the country comes up with strong laws that will deter public office holders from embezzling public funds and as well punishes those who venture into such acts decisively. Thus, the onus lies with the country’s legislators to enact appropriate laws as it is done in other countries and as well strengthen the legislative arm of government to enable them punish law breakers at all times.

Keywords

Public DebtEconomic DevelopmentDomestic DebtExternal Debt

References

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Public Debt and Economic Development in Nigeria: Impact Assessment

Abstract

Keywords

References

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