THE EFFECT OF GOVERNMENT EXPENDITURE AND SMALL AND MEDIUM SIZED ENTERPRISES' OUTPUT ON EMPLOYMENT IN NIGERIA

Authors

  • FELIX AWARA EKE Department of Economics, University of Calabar, Calabar – Nigeria
  • IHUOMA CHIKULIRIM EKE Department of Economics, University of Calabar, Calabar - Nigeria
  • THERESA BANKU MBANG National Directorate of Employment, Federal Secretariat Complex. Calabar, Cross River State - Nigeria
  • IHUOMA CHIKULIRIM EKE Department of Economics, University of Calabar, Calabar - Nigeria
  • EUGENE OKOI IFERE Department of Economics, University of Calabar, Calabar - Nigeria

Keywords:

Government expenditure, SME Output, Employment, Bounds Test, Unit Root test

Abstract

This study investigated the impact of government expenditure and micro and medium enterprises output on employment in Nigeria using the Auto Regressive Distributed Lag model econometric technique. The research design was an analytical approach within the ex-post facto research strategy and the econometric equation is anchored on the Keynesian theory of employment. Secondary data from 1981 to 2022 was collected from The Central Bank of Nigeria, the International Labour Organization, and the World Bank Development Indicators. The unit root test showed that the variables were of mixed order of integration which warranted the use of the Bounds testing approach. The short-run ARDL results for the employment equation show that the estimated long-run coefficients of total government expenditure, output of small and medium-scale enterprises measured by wholesale and retail trade, and human capital development measured by secondary school enrolment were all positive and statistically significant. The study recommended proper channeling of government expenditure into productive economic activities with a direct bearing on the lives of the people. The Government should also encourage and strengthen small-scale enterprises through training and credit support to reduce unemployment. Dedicated funds in specialized funding bodies like the Bank of Industry and Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) should be increased to increase loans to micro and small enterprises (MSEs).

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Published

2024-09-06

How to Cite

FELIX , A. E., IHUOMA , C. E., MBANG , T. B., EKE , I. C., & EUGENE , O. I. (2024). THE EFFECT OF GOVERNMENT EXPENDITURE AND SMALL AND MEDIUM SIZED ENTERPRISES’ OUTPUT ON EMPLOYMENT IN NIGERIA. JOURNAL OF ECONOMICS AND ALLIED RESEARCH, 9(2), 226–239. Retrieved from https://jearecons.com/index.php/jearecons/article/view/420

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