Long-term impact of education expenditure volatility on human capital accumulation, and economic growth in Nigeria
Keywords:
Education Expenditure Volatility, Human Capital Accumulation, Economic Growth, ARDL, GARCH, NigeriaAbstract
This paper focuses on the long-run effect of volatility in education spending on human capital accumulation and economic growth in Nigeria from 1981 to 2024. On the basis of Human Capital Theory and Endogenous Growth Theory, the paper aims to fill an essential gap in understanding that fiscal volatility, more than the amount spent, affects development. By using ARDL tests along with GARCH simulation for time-series data, the authors tried to find the degree to which the effect would occur. The empirical results show that volatility in education spending is an inhibitory factor in human capital accumulation. Also, human capital and foreign investment have been found to play the most significant roles in Nigerian economic growth in the long run. The requisite elasticities for human capital accumulation and foreign investment have been found to be 0.55 and 0.53, respectively. Error Correction Models have confirmed that there are stable cointegrating relationships, which show an annual rate of adjustment at 28 percent to 34 percent. The paper finally argues that volatility in education spending hinders the smoothness required in skill accumulation.Downloads
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