Road Infrastructure Expenditure and Economic Growth: Evidence from Nigeria Fiscal Data

Abebe Isaiah Tete; Gbalam Peter Eze Ph.D

doi:10.56201/jafm.vol.11.no12.2025.pg504.518

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Road Infrastructure Expenditure and Economic Growth: Evidence from Nigeria Fiscal Data

Abebe Isaiah Tete, Gbalam Peter Eze Ph.D

Abstract

This study investigated the impact of road infrastructure expenditure on economic growth in Nigeria using fiscal data from 2000 to 2023. Recognizing infrastructure as a crucial engine for economic development, the research focuses on two key dimensions of road infrastructure investment: road construction expenditure and transport and communication expenditure. The study adopts an ex-post facto research design, utilizing secondary time-series data sourced from the Central Bank of Nigeria and the National Bureau of Statistics. Descriptive statistics, correlation analysis, and Ordinary Least Squares regression techniques were employed to assess the relationship between these infrastructural indicators and economic growth, measured by Gross Domestic Product . The results reveal that road construction expenditure exerts a positive and statistically significant effect on Nigeria’s GDP, suggesting that investments in physical road networks contribute meaningfully to economic advancement. Conversely, transport and communication expenditure was found to have a negative but statistically insignificant relationship with economic growth, indicating inefficiencies or misalignments in allocation or execution within that sub-sector. The model demonstrated a high explanatory power with an R-squared value of approximately 78%, and post-estimation diagnostic tests confirmed the model’s reliability and stability. These findings align with global and regional empirical literature emphasizing the pivotal role of road infrastructure in promoting economic performance. The study recommends increased and well-monitored investments in road construction and a strategic overhaul of transport and communication expenditure to enhance its growth-inducing capacity. Overall, this research contributes to policy debates on infrastructure financing and economic development planning in Nigeria.

Keywords

Road Infrastructureexpenditureeconomic growthinvestmentcommunication

References

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Road Infrastructure Expenditure and Economic Growth: Evidence from Nigeria Fiscal Data

Abstract

Keywords

References

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