Effect of Government Recurrent Expenditure on Economic Prosperity in Nigeria

The study investigated effect of government recurrent expenditure on economic prosperity in Nigeria. The specific objectives of the study were to examine effect of administration expenditure, economic services expenditure, and social and community services (which are proxies for government recurrent expenditure) on gross national product (proxied by economic prosperity) in Nigeria. The study adopted ex-post facto research design and secondary data were extracted from the CBN Statistical Bulletin for the period 1981 – 2022. The multiple regression was used for the test of hypotheses. Findings showed that, recurrent expenditure on administration (GREA) have a statistically non-significant positive effect on Gross National Product (GNP) in Nigeria with a t-statistic of -0.710148 and p-value of 0.4821. On the other hand, recurrent expenditure on economic services (GREES) has a statistically significant positive effect on GNP in Nigeria with a t-statistic of 2.106309 and p-value of 0.0420. In line with recurrent expenditure on administration, recurrent expenditure on social and community services (GRESCS) have a statistically non-significant positive effect on GNP in Nigeria with a t-statistic of 1.835944 and p-value of 0.0744. This implies that only recurrent expenditure on economic services can be used to predict economic prosperity in Nigeria. The study recommended that administrative efficiency should be improved through the reduction of unnecessary costs and streamlining of processes, supported by regular performance evaluations and the adoption of modern technology. Secondly, investments should prioritize critical infrastructure projects like transportation, energy, and telecommunications, aiming to stimulate economic growth and job creation. Lastly, targeted social programs are encouraged to address specific challenges such as poverty reduction, healthcare access, and education, ensuring adequate funding and effective reach to beneficiaries, while also investing in healthcare infrastructure and supporting community development projects that reduce inequality and promote social stability, resulting in long-term benefits for citizens' well-being.