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A Structural Break Analysis of Fiscal Deficit Process in Nigeria

Author

Listed:
  • Owolabi A. Usman

    (Ladoke Akintola University of Technology)

  • Dauda Gbolagade Adebisi

    (Bowen University)

Abstract

The study examined the sustainability of fiscal policy process in Nigeria for the period 1961 to 2013, using ARDL cointegrating method between government revenue and government expenditure. The Bai-Perron multiple break point tests showed that there was structural shift in variables in 1981 which accounted for unsustainable fiscal deficit throughout the period. It was however, found that fiscal deficit before 1981(1961–1980) was weakly sustainable, while the estimation after 1981(1982–2013) indicated strong sustainability of fiscal policy in Nigeria. We therefore recommend that government should continue with the policies put in place by successive governments since 1982 to ensure stability of macroeconomics environment.

Suggested Citation

  • Owolabi A. Usman & Dauda Gbolagade Adebisi, 2017. "A Structural Break Analysis of Fiscal Deficit Process in Nigeria," The Review of Black Political Economy, Springer;National Economic Association, vol. 44(3), pages 341-352, December.
    • Handle: RePEc:spr:blkpoe:v:44:y:2017:i:3:d:10.1007_s12114-017-9261-1
    DOI: 10.1007/s12114-017-9261-1
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    References listed on IDEAS

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