Effect of Public and Private Sector Pension Fund Contribution on the Economic Development of Nigeria

Alpheaus; Ogechi Eberechi; Ibiam; Oti; Okoroafor; Ikechukwu Kingsley

doi:10.56201/jafm.vol.12.no2.2026.pg113.125

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Effect of Public and Private Sector Pension Fund Contribution on the Economic Development of Nigeria

Alpheaus, Ogechi Eberechi, Ibiam, Oti, Okoroafor, Ikechukwu Kingsley

Abstract

This study investigates the effect of public and private sector pension fund contributions on the economic development of Nigeria, using the Human Development Index as a proxy for human-centered development. The research covers a 19-year period (2007–2025) and employs an ex post facto research design, utilizing secondary data sourced from the National Pension Commission , Central Bank of Nigeria , and United Nations Development Programme . The study applies descriptive statistics to summarize trends, the Augmented Dickey-Fuller test to examine stationarity, the Johansen cointegration technique to determine long-run equilibrium relationships, and the Error Correction Model to capture both short- and long-run effects. The findings reveal that both public sector pension fund contributions and private sector pension fund contributions have significant and positive effects on HDI, with private contributions demonstrating a stronger short-run impact. The ECM coefficient indicates that deviations from long-run equilibrium are corrected at a moderate speed, confirming a stable relationship between pension fund accumulation and human development. These results are consistent with the Life- Cycle Theory of Savings and Endogenous Growth Theory, highlighting the role of pension funds as instruments for mobilizing long-term savings and investing in human capital. The study recommends that public pension funds be strategically allocated to social infrastructure and that private pension contributions be encouraged through regulatory incentives and investment diversification to maximize developmental outcomes. Overall, the research underscores the importance of both public and private pension funds in fostering sustainable economic development in Nigeria.

Keywords

Public pension fundLife-Cycle Theory of SavingsPrivate pension fundHuman Development IndexEndogenous Growth TheoryEconomic developmentNigeria.

References

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Effect of Public and Private Sector Pension Fund Contribution on the Economic Development of Nigeria

Abstract

Keywords

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