Economic Growth and Poverty in Nigeria

Abstract

The study examined economic growth and poverty in Nigeria between the periods, 1980-2019. The study utilized quantitative data gathered from secondary sources such as the World Bank Development Indicators, and the National Bureau of Statistics (NBS) annual reports. Augmented Dickey Fuller test, Phillips-Quliaris cointegration test and cointegration regression, specifically, the Dynamic Least Square analysis (DOLS) were used in this study. The findings revealed that economic growth have an indirect long run relationship with poverty rate in Nigeria over the years under study. Accordingly, the result was statistically significant, and thereby conforms to apriori expectation. The study further revealed that unemployment and population growth rate has significant negative impact on poverty rate in Nigeria. While secondary school enrolment and foreign direct investment impacted positively, and are statistically significant on poverty rate in Nigeria. The study also found an absence of causality between economic growth and poverty in Nigeria. Implying that, economic growth has not been influencing the level of poverty in Nigeria since they both perform independently to each other. The study concludes that poverty reduction depends on economic growth, as deduced from the findings that growth is vital for poverty reduction in Nigeria. It therefore recommends among others, that the government of Nigeria should establish a more holistic approach to poverty reduction by focusing on pro poor growth. The changing growth pattern of low-income households should be incentivized through redistributive measures and expanding opportunities.