The Paradox of Persistent Poverty Amid High Growth: The Case of Nigeria

The literature about the poverty and growth nexus maintains that economic growth possesses the capacity to reduce poverty, and empirical findings generally support this view. However, the situation in Nigeria runs counter to this position, giving high and persistent poverty in the face of growth. This chapter assesses the paradox of persistent poverty amid high growth in Nigeria. It compares growth and poverty trends, and presents growth elasticities of poverty. It also suggests a number of explanations for the paradox, including jobless growth, high and rising inequality, inadequate public expenditure on social services, poor governance and corruption, overconcentration on the oil sector, and environmental degradation. The study therefore recommends that critical attention should be paid to measures such as promoting good governance, increasing public expenditure on social services, and diversifying the economy from its overdependence on oil.