ABSTRACT

This study assesses the impact ofinfrastructural spending on economic growth in Nigeria based on the secondary datafrom 1981 to 2018 following literature, we identified the key components of infrastructure in Nigeria as construction, transport and communication, health, and education. Two models were specified, and after applying the substitution method (Reduce form equation), the two models collapsed into one which enabled the researcher to use OLS to run the Regression. The study examined the time series characteristics of the data with Augmented Dickey-Fuller (ADF) unit roots test ofstationarity and the Granger Causality test to test the relationship between economic growth and infrastructure. The result suggests that in the short run, government expenditure on construction is positively related to economic growth in Nigeria and that the impact is also statistically significant. Government expenditure on health was also found to have a positive relationship with economic growth in Nigeria but its impact is statistically insignificant. The study also established that government expenditure on transport and communication and expenditure on education have a negative relationship with economic growth in Nigeria. In conclusion, this research study focuses on investigating the effect of infrastructural spending on Nigeria economic growth between 1981 and 2018 using secondary datafrom various publication ofNBS statistical bulletin. From thefindings ofthe study, it can be concluded that public spending on infrastructure has significant effect on Nigeria economic growth within the years under review. Based on the findings; the study recommends among others that, given the positive and statistically significant impact of construction and health on economic growth, increased investment in construction and health is necessary to achieve economic growth. It suggests also the need for reversal in declining budgetary allocation to education and transport and communication sector in order to provide the sectors with the needed revenue which is necessary in influencing aggregate output ofthe economy.