Revenue generation and economic growth of Nigeria

The essence of revenue generation is to advance the welfare of citizens of a country with focus on promoting economic growth and development through the provision of development activities. Despite remarkable growth recorded in revenue generation the physical state of the nation in terms of social amenities and infrastructure remain backward. The aim of this study is to examine the contribution of revenue generated by the federal government on economic growth of Nigeria, while looking at the specific objectives: examine the influence of oil revenue on economic growth of Nigeria; examine the influence of non-oil revenue on economic growth of Nigeria. The study is backed up with theory of economic growth. Ex-post facto research designs was adopted in the work to examine the contribution of revenue generated on economic growth in Nigeria for the period of 30 years. Secondary data were sourced from Central Bank of Nigeria Statistical Bulletin (2017) for the purpose of this study. Econometric tools of co-integration and error correction model was employed to estimate the individual effect of aggregate revenue generated from Oil and Non-oil on Real Gross Domestic Products. Findings revealed that Oil revenue exerts a negative effect but significant on Real Gross Domestic Products and also non-oil revenue has a negative signed and statistically significant on Real Gross Domestic Products. The study concluded that revenue generated during the period of study have a negative but significant on economic growth of Nigeria this was due to neglect of developmental projects that will generate employment opportunities, abandonment of non-oil sector, profligate spending of the government, amongst others. Hence, government needs to invest massively in agriculture, repositions the tourism sector to attract foreign investors and develop the solid mineral sub-sector, among measures aimed at economic diversification.