IDEAS home Printed from https://ideas.repec.org/a/bcp/journl/v9y2025issue-7p1104-1120.html
   My bibliography  Save this article

Demographic Transition and Economic Growth in Nigeria: An Empirical Investigation

Author

Listed:
  • Tolulope Victoria Alawode

    (Department of Economics, University of Ibadan, Ibadan, Oyo State, Nigeria)

  • Dolapo Temitayo Lawal

    (Department of Economics, University of Ibadan, Ibadan, Oyo State, Nigeria)

Abstract

This study examines the impact of demographic transition on Nigeria’s economic growth from 1981 to 2021 using the ARDL model and Granger causality tests. It finds a strong long-run relationship between demographic structure and GDP per capita, confirmed by an F-statistic of 9.16, which exceeds the 1% significance critical bounds. Long-run results show that a 1% increase in the child population leads to a 23.76% rise in GDP per capita, while a 1% rise in the working-age population results in a 6.30% increase, both reinforcing the demographic dividend hypothesis. However, a 1% increase in the aged population causes a 0.1118% decline in GDP per capita. In the short run, only life expectancy significantly influences growth. Causality analysis reveals a bidirectional relationship between the aged population and economic growth, while child and working-age populations have unidirectional causal effects on growth. The study concludes that strategic investment in education, healthcare, and inclusive economic policies is essential to harness Nigeria’s demographic potential for sustainable growth.

Suggested Citation

  • Tolulope Victoria Alawode & Dolapo Temitayo Lawal, 2025. "Demographic Transition and Economic Growth in Nigeria: An Empirical Investigation," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(7), pages 1104-1120, July.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-7:p:1104-1120
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijriss/Digital-Library/volume-9-issue-7/1104-1120.pdf
    Download Restriction: no
    File URL: https://rsisinternational.org/journals/ijriss/articles/demographic-transition-and-economic-growth-in-nigeria-an-empirical-investigation/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Allen Kelley & Robert Schmidt, 2005. "Evolution of recent economic-demographic modeling: A synthesis," Journal of Population Economics, Springer;European Society for Population Economics, vol. 18(2), pages 275-300, June.
    2. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    3. David E. Bloom & David Canning, 2004. "Global demographic change : dimensions and economic significance," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, issue Aug, pages 9-56.
    4. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    5. Ronald Lee & A. Mason & E. Amporfu & C.-B. An & L. R. Bixby & J. Bravo & M. Bucheli & Q. Chen & P. Comelatto & D. Coy & Hippolyte d'Albis & G. Donehower & L. Dramani & A. Furnkranz-Prskawetz & R. I. G, 2014. "Is low fertility really a problem? Population aging, dependency, and consumption," Post-Print hal-01075298, HAL.
    6. Christian Göbel & Thomas Zwick, 2012. "Age and Productivity: Sector Differences," De Economist, Springer, vol. 160(1), pages 35-57, March.
    7. Gary S. Becker, 1964. "Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, First Edition," NBER Books, National Bureau of Economic Research, Inc, number beck-5, March.
    8. Bloom, David E & Williamson, Jeffrey G, 1998. "Demographic Transitions and Economic Miracles in Emerging Asia," The World Bank Economic Review, World Bank, vol. 12(3), pages 419-455, September.
    9. Andrew Mason & Ronald Lee, 2011. "Population aging and the generational economy: key findings," Chapters, in: Ronald Lee & Andrew Mason (ed.), Population Aging and the Generational Economy, chapter 1, Edward Elgar Publishing.
    10. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    11. Ana Cardoso & Paulo Guimarães & José Varejão, 2011. "Are Older Workers Worthy of Their Pay? An Empirical Investigation of Age-Productivity and Age-Wage Nexuses," De Economist, Springer, vol. 159(2), pages 95-111, June.
    12. David Dollar & Aart Kraay, 2004. "Trade, Growth, and Poverty," Economic Journal, Royal Economic Society, vol. 114(493), pages 22-49, February.
    13. Ronald Lee & Andrew Mason (ed.), 2011. "Population Aging and the Generational Economy," Books, Edward Elgar Publishing, number 13816, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ahmed, S. Amer & Vargas Da Cruz,Marcio Jose & Quillin,Bryce Ramsey & Schellekens,Philip, 2016. "Demographic change and development : a global typology," Policy Research Working Paper Series 7893, The World Bank.
    2. Quamrul H. Ashraf & David N. Weil & Joshua Wilde, 2013. "The Effect of Fertility Reduction on Economic Growth," Population and Development Review, The Population Council, Inc., vol. 39(1), pages 97-130, March.
    3. N. Renuga Nagarajan & Aurora A. C. Teixeira & Sandra T. Silva, 2021. "Ageing Population: Identifying the Determinants of Ageing in the Least Developed Countries," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 40(2), pages 187-210, April.
    4. Benoît Mahy & François Rycx & Guillaume Vermeylen & Mélanie Volral, 2022. "Productivity and wage effects of firm‐level upstreamness: Evidence from Belgian linked panel data," The World Economy, Wiley Blackwell, vol. 45(7), pages 2222-2250, July.
    5. Jesús Crespo Cuaresma & Wolfgang Lutz & Warren Sanderson, 2014. "Is the Demographic Dividend an Education Dividend?," Demography, Springer;Population Association of America (PAA), vol. 51(1), pages 299-315, February.
    6. Onafowora, Olugbenga A. & Owoye, Oluwole, 2024. "Trade openness, governance quality, and economic growth in Latin America and the Caribbean," International Economics, Elsevier, vol. 179(C).
    7. Bloom, David E. & Canning, David & Kotschy, Rainer & Prettner, Klaus & Schünemann, Johannes, 2024. "Health and economic growth: Reconciling the micro and macro evidence," World Development, Elsevier, vol. 178(C).
    8. Amaia Altuzarra & Catalina Gálvez-Gálvez & Ana González-Flores, 2021. "Is Gender Inequality a Barrier to Economic Growth? A Panel Data Analysis of Developing Countries," Sustainability, MDPI, vol. 13(1), pages 1-21, January.
    9. Thomas Flochel & Yuki Ikeda & Harry Moroz & Nithin Umapathi, 2014. "Macroeconomic Implications of Aging in East Asia Pacific," World Bank Publications - Reports 23026, The World Bank Group.
    10. Danquah, Michael & Amankwah-Amoah, Joseph, 2017. "Assessing the relationships between human capital, innovation and technology adoption: Evidence from sub-Saharan Africa," Technological Forecasting and Social Change, Elsevier, vol. 122(C), pages 24-33.
    11. Eftimoski, Dimitar, 2022. "On the inconclusive effect of human capital on growth: A new look at extended specifications," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 708-727.
    12. Stimpfle, Alexander & Stadelmann, David, 2015. "The Impact of Fundamental Development Factors on Different Income Groups: International Evidence," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113128, Verein für Socialpolitik / German Economic Association.
    13. Andrea Garnero & François Rycx & Isabelle Terraz, 2020. "Productivity and Wage Effects of Firm‐Level Collective Agreements: Evidence from Belgian Linked Panel Data," British Journal of Industrial Relations, London School of Economics, vol. 58(4), pages 936-972, December.
    14. Quamrul H. Ashraf & David N. Weil & Joshua Wilde, 2011. "The Effect of Fertility Reduction on Economic Growth," Center for Development Economics 2011-07, Department of Economics, Williams College, revised Feb 2013.
    15. David E. Bloom & Alex Khoury & Vadim Kufenko & Klaus Prettner, 2021. "Spurring Economic Growth through Human Development: Research Results and Guidance for Policymakers," Population and Development Review, The Population Council, Inc., vol. 47(2), pages 377-409, June.
    16. François Rycx & Yves Saks & Ilan Tojerow, 2015. "Does Education Raise Productivity and Wages Equally? The Moderating Roles of Age, Gender and Industry," Working Paper Research 281, National Bank of Belgium.
    17. Aribah Aslam, 2020. "The hotly debate of human capital and economic growth: why institutions may matter?," Quality & Quantity: International Journal of Methodology, Springer, vol. 54(4), pages 1351-1362, August.
    18. Stephan Kampelmann & François Rycx & Yves Saks & Ilan Tojerow, 2018. "Does education raise productivity and wages equally? The moderating role of age and gender," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-37, December.
    19. Stephan Kampelmann & Benoit Mahy & François Rycx & Guillaume Vermeylen, 2016. "Who is your perfect match? Educational norms, educational mismatch and firm profitability," Working Papers CEB 16-050, ULB -- Universite Libre de Bruxelles.
    20. Benoît Mahy & François Rycx & Guillaume Vermeylen & Mélanie Volral, 2018. "Productivity, wages and profits: Does firms’ position in the value chain matter?," Working Paper Research 358, National Bank of Belgium.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bcp:journl:v:9:y:2025:issue-7:p:1104-1120. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Pawan Verma (email available below). General contact details of provider: https://rsisinternational.org/journals/ijriss/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.