Non-Linear Effect of Government Debt on Public Expenditure in Nigeria: Insight from Bootstrap ARDL Procedure
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| Format: | Artículo científico |
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Vilniaus Universitetas
2022
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| author | Abu Nurudeen |
| author_facet | Abu Nurudeen |
| contents | Non-Linear Effect of Government Debt on Public Expenditure in Nigeria: Insight from Bootstrap ARDL Procedure Abu Nurudeen David Joseph Gamal Awadh Ahmed Mohammed Ben Obi Economía y Finanzas Nigeria public debt bootstrap ARDL Public expenditure dynamic ARDL simulations This study employs the bootstrap autoregressive distributed lag (ARDL) approach alongside the dynamic ARDL simulations technique to investigate the non-linear effect of public debt on public expenditure in Nigeria during the 1981–2020 period. The result of the bootstrap bounds test illustrates the presence of a long-term relationship between public expenditure and public debt (along with oil rents, output growth and urbanisation). Further, the estimation results indicate that the effect of public debt on public expenditure is non-linear. In particular, public expenditure increases at early stages of rising public debt but declines at latter phases when public debt grows beyond specific threshold. This empirical outcome is further validated by the dynamic ARDL simulations approach which shows a significant decline in predicted public expenditure after short-term expansion due to counterfactual shock in public debt. Thus, policies which diversify public revenue from oil production and a reversal of the rising trend in public debt are recommended to avert the adverse welfare implications of declining public expenditure. 2022 artículo científico 2029-4581 https://www.redalyc.org/articulo.oa?id=692372942008 https://www.redalyc.org/journal/6923/692372942008/ https://www.redalyc.org/journal/6923/692372942008/html/ https://www.redalyc.org/journal/6923/692372942008/692372942008.epub https://www.redalyc.org/journal/6923/692372942008/movil https://doi.org/10.15388/omee.2022.13.75 es http://www.redalyc.org/revista.oa?id=6923 Organizations and Markets in Emerging Economies application/pdf Vilniaus Universitetas Organizations and Markets in Emerging Economies (Lituania) Num.1 Vol.13 |
| format | Artículo científico |
| id | redalyc_692372942008 |
| institution | Redalyc |
| language | es |
| publishDate | 2022 |
| publisher | Vilniaus Universitetas |
| spellingShingle | Non-Linear Effect of Government Debt on Public Expenditure in Nigeria: Insight from Bootstrap ARDL Procedure Abu Nurudeen Economía y Finanzas Nigeria public debt bootstrap ARDL Public expenditure dynamic ARDL simulations Non-Linear Effect of Government Debt on Public Expenditure in Nigeria: Insight from Bootstrap ARDL Procedure Abu Nurudeen David Joseph Gamal Awadh Ahmed Mohammed Ben Obi Economía y Finanzas Nigeria public debt bootstrap ARDL Public expenditure dynamic ARDL simulations This study employs the bootstrap autoregressive distributed lag (ARDL) approach alongside the dynamic ARDL simulations technique to investigate the non-linear effect of public debt on public expenditure in Nigeria during the 1981–2020 period. The result of the bootstrap bounds test illustrates the presence of a long-term relationship between public expenditure and public debt (along with oil rents, output growth and urbanisation). Further, the estimation results indicate that the effect of public debt on public expenditure is non-linear. In particular, public expenditure increases at early stages of rising public debt but declines at latter phases when public debt grows beyond specific threshold. This empirical outcome is further validated by the dynamic ARDL simulations approach which shows a significant decline in predicted public expenditure after short-term expansion due to counterfactual shock in public debt. Thus, policies which diversify public revenue from oil production and a reversal of the rising trend in public debt are recommended to avert the adverse welfare implications of declining public expenditure. 2022 artículo científico 2029-4581 https://www.redalyc.org/articulo.oa?id=692372942008 https://www.redalyc.org/journal/6923/692372942008/ https://www.redalyc.org/journal/6923/692372942008/html/ https://www.redalyc.org/journal/6923/692372942008/692372942008.epub https://www.redalyc.org/journal/6923/692372942008/movil https://doi.org/10.15388/omee.2022.13.75 es http://www.redalyc.org/revista.oa?id=6923 Organizations and Markets in Emerging Economies application/pdf Vilniaus Universitetas Organizations and Markets in Emerging Economies (Lituania) Num.1 Vol.13 |
| title | Non-Linear Effect of Government Debt on Public Expenditure in Nigeria: Insight from Bootstrap ARDL Procedure |
| topic | Economía y Finanzas Nigeria public debt bootstrap ARDL Public expenditure dynamic ARDL simulations |
| url | https://www.redalyc.org/articulo.oa?id=692372942008 https://www.redalyc.org/journal/6923/692372942008/ https://www.redalyc.org/journal/6923/692372942008/html/ https://www.redalyc.org/journal/6923/692372942008/692372942008.epub https://www.redalyc.org/journal/6923/692372942008/movil https://doi.org/10.15388/omee.2022.13.75 |