Government Spending across Sectors and Its Impact on Economic Growth inNigeria

This study investigated the impact of sectoral expenditure on economic growth in Nigeria, focusing on key sectors such as Agriculture, Education, Health, Defence, Transport and Communication and road and Construction. Utilized secondary data from 1994 to 2023, the research employed econometric methodologies, specifically Error Correction Model (ECM) and Vector Autoregressive (VAR) model, to analyze the relationship between public expenditure and Gross Domestic Product (GDP) growth. The findings revealed insignificant relationship between sectoral expenditures and economic growth, indicating that investments in education and others insignificant returns. The study underscores the crucial role of targeting public spending in driving sustainable economic development in Nigeria and offers policy recommendations to optimize expenditure across sectors. Therefore, there is need for the Nigerian government to prioritize sectoral spending, particularly in education, health and Agriculture, to foster sustainable economic growth. By addressing existing gaps in the literature regarding the interplay of different sectors, this research contributes valuable insights for policymakers aimed at enhancing economic growth through effective public expenditure strategies.