ABSTRACT
This
study evaluated the impact of fiscal policy on the economic growth in Nigeria
with respect to company income tax and domestic investment from 1994-2010.
Effort was made to see how company income tax and value added tax (VAT)
influenced the economy. This it was specified that domestic investment is the
function of company income tax and value added tax with of regression analysis,
it was found that 93.08% of the total variations in the dependent variable
(domestic investment) is accounted for by the explanatory variables. This
implied that fiscal policy has significant impact on the economy. Thus, to
ensure increased investment within the economy, the Nigeria investment
promotion decree should be promulgated and repealed.
DEPARTMENT OF ECONOMICS,
FACULTY OF SOCIAL SCIENCES
TABLE OF CONTENTS
TABLE OF CONTENTS
Title
Page i
Approval
Page ii
Dedication
iii
Acknowledgment
iv
Table
of Contents v
Abstract vi
CHAPTER ONE: Introduction
1.1 Background of the Study 1
1.2 Statement of the Problem 3
1.3 Objective of Study 4
1.4 Hypothesis of the Study 4
1.5 Significance of the Study 4
1.6 Scope of the Study 4
1.7 Limitation of the Study 5
CHAPTER TWO: Literature Review
2.1 The instrument of the Fiscal Policy 8
2.2 Administration of taxation in Nigeria 10
2.3 Limitation of Previous Studies 21
CHAPTER THREE: Research Methodology
3.1 Model Specification 23
3.2 Model Evaluation 24
3.3 Source of Data 26
CHAPTER FOUR: Presentation and Analysis of Results
4.1 Presentation of Results 27
4.2 Analysis of Study 27
4.3 Test of Hypothesis 29
4.4 Implication of the Study 29
CHAPTER FIVE:
Summary
of Findings, Conclusion and Policy Recommendation
5.1 Summary of Findings 31
52 Conclusion 32
5.3 Recommendation 32
Bibliography 33
Appendix I
Appendix II
BIBLIOGRAPHY
Ahmed,
S. (1986), Temporary and Permanent Government Spending in an Economy,
Journal of Monetary Economics, vol. 17
Alesina,
A. and Peroth, R. (1999), The Welfare State and Competitiveness, National
Bureau of Economic Research, working
paper No. 4810.
Byrns T. R. and Stone, W. G.
(1992), Economics fifth edition, New
York Harper Collins Publishers.
Iyoah A. M. (2004), Macroeconomics.
Theory and Policy, Benin, Mindex Publishing.
Jhingan, M. L. (1997), Macroeconomic
Theory, India, Vrinda Publication.
Bartolini,
et al (1995), G-7 Fiscal Restructure in the 1990: Macroeconomic Effects, Macro-Policy vol. 10 No.20.
Byrns,
T. R. and Stone, W. G. (1992), Economics, New York, Harper Collins Publishers.
Folster,
S. and Henrekson, M. (2001), Growth Effects of Government Expenditure
and Taxation in rich Countries, European
Economic Review, vol.
No.8.
Gwartney,
et al. (1998), The Size and Functions of Government and Economic Growth, vol. 20 No.15.
Iyoha,
A. M. (2004), Macroeconomics. Theory and Policy, Benin, Mindex Publishing.
Jhingan,
M. L. (1997), Macro-Economic Theory, India, Vrinda Publications (P) Ltd.
Mitchell,
J. O. (2005), The Impact of Government Spending on Economic Growth, Heritage Foundation Backgrounder No. 1831.
Ndayako,
H. (2007), The Impact of Fiscal Policy on the Nigerian Economy, University of Abuja
Publication.
Ojo,
O. M. (2000), Fiscal and Monetary Policy during Structural Adjustment
Programme in Nigeria, African Economic Research Consortium, CBN
Publications.
Onwukwe,
N. U. (2003), Fundamentals of Macroeconomics, Abakaliki, Printwell Press Limited.
Ugwuanyi, U. C. (2004), Basic
Principles of Finance, Nsukka, Great
AP Express Publishers Ltd.
www.fmf.gov.ng/fmf-news.aspx...
Koutsoyannis, A. (2997), Theory
of economics Second edition, New
York, Palgrave Publishers.
Nwobuokei P. O. (2001), Foundational of statistics,
Enugu, Koruna Books.
APPENDIX I
DATA FOR ANALYSIS
|
YEAR
|
INV
(N’Million)
|
CIT
(N’Million)
|
VAT
(N’Million)
|
|
1994
|
80948
|
201911
|
7260.8
|
|
1995
|
85022
|
459987
|
20761
|
|
1996
|
114476
|
523597
|
31000
|
|
1997
|
172736
|
582811
|
34000
|
|
1998
|
205553
|
463609
|
36900
|
|
1999
|
192984
|
949188
|
47100
|
|
2000
|
175736
|
1906.2
|
58500
|
|
2001
|
268895
|
2231.6
|
91800
|
|
2002
|
438115
|
1731.8
|
108600
|
|
2003
|
429230
|
2575.1
|
136400
|
|
2004
|
455736
|
3920.5
|
159500
|
|
2005
|
469320
|
5547.5
|
178100
|
|
2006
|
495623
|
5965.1
|
221600
|
|
2007
|
473560
|
5715.6
|
230800
|
|
2008
|
479501
|
6246.7
|
241800
|
|
2009
|
537463
|
7091.2
|
265700
|
|
2010
|
562081
|
7283.7
|
301400
|
SOURCE: CBN
STATISTICAL BULLETIN, VOLUME 20, 2009
APPENDIX II
APPENDIX II
REGRESSION RESULTS
|
Dependent Variable:
LOG(INV)
|
||||
|
Method: Least Squares
|
||||
|
Date: 05/26/13 Time: 14:23
|
||||
|
Sample: 1994 2010
|
||||
|
Included observations: 17
|
||||
|
Variable
|
Coefficient
|
Std. Error
|
t-Statistic
|
Prob.
|
|
C
|
6.284634
|
0.968899
|
6.486364
|
0.0000
|
|
LOG(CIT)
|
-0.020509
|
0.028722
|
-0.714037
|
0.4869
|
|
LOG(VAT)
|
0.568745
|
0.064942
|
8.757695
|
0.0000
|
|
R-squared
|
0.930802
|
Mean dependent var
|
12.53455
|
|
|
Adjusted R-squared
|
0.920917
|
S.D. dependent var
|
0.667781
|
|
|
S.E. of regression
|
0.187792
|
Akaike info criterion
|
-0.348182
|
|
|
Sum squared resid
|
0.493720
|
Schwarz criterion
|
-0.201144
|
|
|
Log likelihood
|
5.959548
|
F-statistic
|
94.15915
|
|
|
Durbin-Watson stat
|
1.624501
|
Prob(F-statistic)
|
0.000000
|
|
|
Dependent Variable: INV
|
||||
|
Method: Least Squares
|
||||
|
Date: 05/26/13 Time: 15:10
|
||||
|
Sample: 1994 2010
|
||||
|
Included observations: 17
|
||||
|
Variable
|
Coefficient
|
Std. Error
|
t-Statistic
|
Prob.
|
|
C
|
150029.0
|
37741.17
|
3.975208
|
0.0014
|
|
CIT
|
-0.075639
|
0.066122
|
-1.143932
|
0.2718
|
|
VAT
|
1.534113
|
0.199321
|
7.696713
|
0.0000
|
|
R-squared
|
0.898097
|
Mean dependent var
|
331587.0
|
|
|
Adjusted R-squared
|
0.883540
|
S.D. dependent var
|
173028.4
|
|
|
S.E. of regression
|
59048.12
|
Akaike info criterion
|
24.96888
|
|
|
Sum squared resid
|
4.88E+10
|
Schwarz criterion
|
25.11592
|
|
|
Log likelihood
|
-209.2355
|
F-statistic
|
61.69299
|
|
|
Durbin-Watson stat
|
0.926153
|
Prob(F-statistic)
|
0.000000
|
|