AN ASSESSMENT OF THE DETERMINANTS OF FISCAL POLICY BEHAVIOUR IN NIGERIA: 1980-2014
The study assessed the determinants of fiscal behaviour in Nigeria between 1980 and 2014.Literatures have shown that past empirical work are more on effect rather than causes of fiscal policy behavior consequently this study contributes to the existing literature by focusing on factors responsible for fiscal policy behavior in Nigeria, thereby providing the policy makers avenue to tackle Nigeria fiscal problem from the causes. Government expenditure, government revenue, external reserve, exchange rateand regime of administration in the country have been adjudged to be important factors that affect the behavior of fiscal policy. Fiscal balance is used to capture fiscal behavior and it is the dependent variable of the model. Auto-regressive distributed lags ARDL bound test is used to examine the existence of long run relationship between the fiscal variables and fiscal balance. The descriptive results show that the major feature of fiscal behavior in Nigeria is deficit that is fiscal deficit. Cointegration is confirmed between the fiscal variables which are the determinants and the fiscal behavior. The short run analysis also confirms significant short run impact. The implication is that government revenue, government expenditure, external reserve and regime of administration have both permanent and transitory significant impacts on fiscal behavior in Nigeria.
|Keywords: Fiscal Policy, Determinants, Fiscal Behavior, Government Expenditure, Government Revenue|
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