Keywords: Expenditure, Public Infrastructure, Economic Development, Growth, VECM
Abstract
he purpose of public spending on infrastructure is primarily for economic growth and development. However, clearly deciphering the effect of these expenditures on the real economic development and people’s welfare continues to agitate researchers. This study investigated how public infrastructure in transport (GEXTR), education (GEXED), utilities (GEXUT), communication (GEXCM) and health (GEXHT) affect economic development from two perspectives: Real Gross Domestic Product (RGDP) and Per capita income (PCIN) from 1986 to 2025. The Vector Error Correction Mechanism (VECM) was used to estimate the effects of public infrastructure expenditures on RGDP and PCIN. The VECM results showed that GEXED, GEXUT and GEXCM have positive and significant effect on RGDP (coefficient 22.81004, p = 0.0353; coefficient = 34.16946, p = 0.0382 and coefficient = 3.806990, = 0.0172 respectively). However, GEXHT unexpectedly has a significant negative effect on RGDP during the second lag (coefficient = -107.6642, p = 0.0283). Public infrastructure expenditures had no significant effect on PCIN during the short or long runs. The study recommended that policy makers should prioritize investments ineducation, utility and communication as they have positive effect on RGDP..Government should address inefficiencies in healthcare system and reduce corruption.
PUBLIC INFRASTRUCTURE, EXPENDITURE AND ECONOMIC DEVELOPMENT IN NIGERIA, 2026, Vol. 4, No. 1, pp. 49-59. PDF