IMPACT OF FISCAL FEDERALISM ON ECONOMIC GROWTH IN CENTRAL NIGERIA: 1997 - 2016

Fiscal federalism, which shows the amount of fiscal autonomy and responsibility accorded to sub national government, has been an important subject in the policy equation in Nigeria. Sub national government has constantly faced rigorous challenges in carrying out their developmental duties. This study therefore examines the impact offiscal federalism on the growth of sub-national government in Central Nigeria. The study adopted quantitative longitudinal panel data regression analysis using data collected from 1997- 2016. Findings from the study showed that Internally Generated Revenue of sub- national governments have a significant contribution to Economic Growth in Central Nigeria. It was also obseived from the study that Sub-national government Statutory Allocation has a significant impact on Economic Grozvth in Central Nigeria. Based on the study findings it was recommended that Federal laws should be adjusted to give more economic power to the sub national governments in order to enhance its ability to generate internal revenue in the state. The state governments need to structure an effective tax collecting system as more revenue can be generated through tax for economic growth. Fiscal base of sub-national government needs to be strengthened by assigning more revenue generating ability so as to reduce total dependence on statutory allocation