Fiscal Policy and Nigeria Economic Growth

ABSTRACTThis study was conducted to examine the impact of fiscal policy and the Nigeria economic growth.The study adopted ex-post facto research design. The population for this study comprised of the fiscalpolicy and economic growth of Nigeria between 2002-2022. The study is based on three fiscal policymeasures which are tax revenue, recurrent expenditure and capital expenditure within a period of 22years (2002-2022). The method of data collection for this study was through the use of informationgathered from the central Bank of Nigeria (CBN) Statistical Bulletin, Federal inland revenue service(FIRS) and National Bureau of Statistics (NBS) from 2002-2022. The study method of data analysis isthrough the use of ordinary least square (OLS) . The result in hypotheses one revealed that tax revenuehas a positive impact on Nigeria’s GDP. The result revealed that an increase in tax revenue by 1 unitis associated with a rise in GDP by approximately 1.275401 unit assuming all other variables remainsconstant. In hypotheses two, the result revealed that recurrent expenditure (RE) has a seeminglypositive yet complex effect on Nigeria’s GDP. The result shows that the coefficient of -0.0660723suggest for each unit increase in RE, GDP decreases by approximately 0.06607723 units, reflectinga negative relationship between RE and GDP. The result in hypotheses three reveals that capitalexpenditure has a positive coefficient of 0.1401936 suggesting that an increase in capital expenditureby 1 unit correlates with a GDP increase of approximately 0.1401936 units when all other factorsremain constant.. Hence, the study recommended that the Nigeria government should strengthen itstax collection Frameworks and reduce leakages. This can be achieved by adopting advancedtechnology like e-taxation, which streamline processes and minimize evasion.