EFFECT OF FISCAL POLICY ON ECONOMIC GROWTH IN NIGERIA

This study examines the effects of fiscal policy on economic growth in Nigeria for the period 1995-2015. The study used times series data in its analysis. The model adopted for the study is Robust Least Square (RLS) technique using M- estimation method to estimate the model. Also, some econometric techniques such as Granger Causality, Cointegration and ADF tests were employed in the analysis of the data. The findings established that there exist positive and significant relationship between fiscal policy and economic growth in Nigeria. From the results, one-unit increase in GE, GTR and TDF will lead to 4.222740, 0.002013 and 8.616608 units increase in RGDP respectively. The study recommends increase in government expenditure especially in the productive sectors in order to boost economic performance. The study also recommends government to develop a robust tax base and sound policies to strengthen tax authorities in Nigeria so as to boost economic growth.