Public Expenditure and Economic Growth in Nigeria: A Sectoral Analysis of Health and Agriculture

Abstract

This study evaluates the effect of public expenditure on economic growth in Nigeria using time series data of 34 years (1991-2024. The underpinning theory is Keynesian Theory. Ex-post-facto research design was employed and the descriptive statistics, panel regression model, correlation coefficient (R), R-Square, Adjusted R-Square, t-Statistic (t-Stat) and P-value are used to analyze the data collected and to test the hypotheses stated as well. The level of significance is 5%. The findings of the study indicates; agriculture expenditure showed positive and significant effect on Gross domestic product; health expenditures indicated negative and insignificant effect on Gross domestic product. The study concluded that there is need for strategic allocation and effective management of public funds to maximize their growth-enhancing potential. It is recommended that government should prioritize and expand investment in the agricultural thereby strengthening its role as a key engine of economic growth and health expenditure should be restructured and better managed to improve efficiency.