An empirical investigation of government spending in primary school enrolment and poverty reduction in Nigeria

The economic rationale for government policy attention to unemployment and education is fundamentally to reduce poverty. A higher poverty rate suggests that citizens’ welfare is at a low ebb. In Nigeria and other African countries, governments have historically addressed poverty with increased state spending. Therefore, this study sought to ascertain the role of government spending to reduce poverty in Nigeria between 1980 and 2017. Secondary data sourced from Central Bank of Nigeria publications, National Bureau of Statistics, indexmundi.com and World Development Indicators were utilized for the analyses. The data were on Government Capital Expenditure (GCEX), Government Recurrent Expenditure (GREX), Primary School Enrolment (PSE), and Per Capita Income (PCI).Descriptive statistics, Ordinary Least Squares(OLS) method of multiple regressions, as well as Engel-Granger variant of Error Correction Mechanism (ECM) test approaches were adopted to analyse the variables. The test result reveals that government capital expenditure is positively related to per capita income after one-year lag period. Again, the government recurrent expenditure stood negative and significantly affects per capita income after a oneyear lag period, while the primary school enrolment rate exhibits a positive and insignificant relationship with it after three-year lag period. The paper therefore concludes that a longitudinal increase in government expenditures did not play a significant role in reducing poverty in Nigeria. The paper recommends that the government needs to prioritize its expenditures by allocating more of its resources to the capital component of annual budgets, to create the desired human and non-human infrastructure necessary to promote economic growth and development, thereby reducing the rising incidence of poverty in Nigeria.