Government Expenditure and Economic Growth in Nigeria

Government Expenditure and Economic Growth in Nigeria

Government Expenditure – Economic growth represents the expansion of a country‚Äôs potential national output or potential real GNP; the expansion of economic power to produce (Ukwu, 2004). Without some kinds of economic growth, developing countries cannot extricate themselves from the quagmire of primordial poverty. Thus, these countries usually pursue fiscal policy to achieve accelerated economic growth. The term fiscal policy refers to the use of fiscal instruments (such as taxation and spending) to influence the working of the economic system in order to maximize economic welfare (Tanzi, 1994). The main objective of fiscal policy in less developed countries should then, be promoting long term growth of the economy. [Read more…]