Volume XIX, Number 2 (November 2016)
ABSTRACTS
Productive Government Expenditure and Economic Performance in sub-Saharan Africa: An Empirical Investigation
Hammed Adetola Adefeso
Abstract: This study examined the effect of government expenditure on its disaggregated level on economic growth in a sample of 20 sub-Saharan African Countries over the period of 19802010 in a dynamic panel data model. The result from Generalised Method of Moments (GMM) revealed an inverse relationship between productive government expenditure and economic growth in sub-Sahara Africa. Also, productive government expenditures were not actually productive most especially when financed by non-distortionary government tax revenue in sub-Saharan African countries. The study concluded that the productive government expenditure and its corresponding source of the mode of financing were counterproductive for economic performance in the African countries.
Key words: Productive government expenditure; economic performance; GMM; non-distortionary taxation
JEL Classification: C01, H00
Forecasting of Households Consumption Expenditure with Nonparametric Regression: The Case of Turkey
Noyan Aydin
Taner Akmercan
Abstract: The relationship between household income and expenditure is important for understanding how the shape of the economic dynamics of the households. In this study, the relationship between household consumption expenditure and household disposable income were analyzed by Locally Weighted Scatterplot Smoothing Regression which is a nonparametric method using R programming. This study aimed to determine relationship between variables directly, unlike making any assumptions are commonly used as in the conventional parametric regression. According to the findings, effect on expenditure with increasing of income and household size together increased rapidly at first, and then speed of increase decreased. This increase can be explained by having greater compulsory consumption expenditure relatively in small households. Besides, expenditure is relatively higher in middle and high income levels according to low income level. However, the change in expenditure is limited in middle and is the most limited in high income levels when household size changes.
Key words: Household Consumption Expenditure; nonparametric regression; LOESS
JEL Classification: C14, D12
Government Spending and Inclusive-Growth Relationship in Nigeria: An Empirical Investigation
Bashir Olayinka Kolawole
Abstract: This study has investigated the relationship between government spending and inclusive growth in Nigeria over the period 1995 to 2014. Specifically, it examined how, and to what extent, government spending on education, government spending on health, economic freedom, public resource use, and real GDP growth rate have impacted on inclusive growth in the country. It used the Dickey-Fuller GLS unit root test to ascertain the order of integration of the series. Consequently, through the Auto-Regressive Distributed Lag (ARDL) bound testing technique, the study found that in the long-run government spending on health, economic freedom, public resource use and real GDP growth rate had significantly positive influence on inclusive growth. In the short-run, however, only real GDP impacted significantly on inclusive growth while other variables were not significant in causing inclusive growth. Thus, in conclusion, government spending in the form of redistributive spending on health propelled inclusive growth in Nigeria.
Key words: ARDL; cointegration; government spending; inclusive growth; Nigeria
JEL Classification: B52, H50, O47
Do Financial and Trade Openness Lead to Financial Sector Development in Nigeria?
Abayomi Toyin Onanuga
Olaronke Toyin Onanuga
Abstract: With so many countries of the world now open to global capital and trade, this study identifies whether financial and trade openness contribute to the development of Nigeria’s financial system by considering both financial depth and access to finance indicators. To achieve this objective, we applied the Simultaneous Openness Hypothesis as our theoretical framework and the Generalized Method of Moments (GMM) as our estimation method. Our findings reveal that opening trade while neglecting capital (vice versa) may be detrimental to the development of Nigeria financial system. In view of this evidence, we recommend that the simultaneous opening of trade and finance is a more guaranteed way of ensuring improved financial development in Nigeria.
Key words: Financial Openness; Trade Openness; Financial Development; Financial Institutions; Financial Markets
JEL Classification: F1, F3, G1, G2