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Relevance of Wagner’s Hypothesis in Achieving Sustainable Development Agenda in Nigeria

Author

Listed:
  • Isiaq O. Oseni

    (Olabisi Onabanjo University, Ago-Iwoye, Nigeria)

  • Ibrahim A. Adekunle

    (Olabisi Onabanjo University, Ago-Iwoye, Nigeria)

Abstract

Policy ambiguity in the form of non-directional and non-purposeful use of state resources has made sustainable growth outcomes a mirage in Nigeria. Recent economic crisis prompted the debate on how increased government spending induces sustainable economic growth in Nigeria. This paper examines the validity or otherwise of Wagner’s theory in Nigeria for the realisation of the Sustainable Development Goals (SDGs) from 1980 through 2017. Using time-series data on real gross domestic product, total government expenditure, money supply and domestic investment and adopting the two-step Engle and Granger estimation procedure, result shows that increased government spending significantly predicts variations in real gross domestic product and thus leaned empirical credence to Wagner’s hypothesis as an essential concept for the attainment of Sustainable Development Goals in Nigeria. This paper recommended that the government should exhaust all possible options to increase expenditure in order to realise sustainable growth in Nigeria.

Suggested Citation

  • Isiaq O. Oseni & Ibrahim A. Adekunle, 2020. "Relevance of Wagner’s Hypothesis in Achieving Sustainable Development Agenda in Nigeria," Working Papers of the African Governance and Development Institute. 20/006, African Governance and Development Institute..
    • Handle: RePEc:agd:wpaper:20/006
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    Government Expenditure; Economic Growth; Wagner law; Granger Causality;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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