Defence Spending and Economic Growth in Nigeria:Is There Any Relationship?Vector Error Correction Model(VECM)Aproach

• 作者: Peter Ego Ayunku
• 来源期刊: 美中经济评论:英文版
• 学科: 经济
• 关键词: economic growth CO-INTEGRATION Vector Error Correction Model(VECM) “Boko Haram” INSURGENCY
• 年，卷（期）: 2018,（8）
• 页码范围: 410-418
• 页数: 9页
• 分类号: F

摘要

This study investigates whether there exists any relationship between defense spending and economic growth in Nigeria,for the period of 1977 to 2010.We employed ex-post facto research design in this study as a set of some econometric techniques which utilized to investigate the relationship between defense spending and economic growth in Nigeria.The estimation regression result revealed that,defense(DEF)and Interest rate(INT)had a positive influence on economic growth in Nigeria in the long run,while in the short run defense(DEF)and Interest rate(INT)had a negative influence on economic growth in Nigeria.However,the pairwise granger causality test indicates a bi-directional relationship between defense and economic growth,while there was no causal relationship between interest rate and defense and economic growth respectively.Also,the VEC(Vector Error Correction)residual normality test indicates that the residuals are multivariate and are jointly normal.The study therefore,amongst others recommends that government should increase funding on defense and if possible seek foreign aid so as to adequately tackle the menace of“Boko Haram”insurgency in the northern part of Nigeria so as to attract foreign investment that would further stimulate economic growth and development in Nigeria.