Fiscal Stimulus and Human Capital in Nigeria: A Bayesian VAR Analysis

Evans, Olaniyi (2025): Fiscal Stimulus and Human Capital in Nigeria: A Bayesian VAR Analysis. Published in:

Abstract

This study investigates the relationship between fiscal stimulus and human capital in Nigeria between 1981-2015 using Bayesian estimation (BVAR model) with a KoKo Minnesota/Litterman prior distribution. Fiscal stimulus is proxied by education expenditure and human capital by school enrolment rates. The findings show that higher fiscal stimulus is associated with higher levels of human capital in Nigeria. It is, however, interesting to note that fiscal stimulus is having an insignificant positive impact on human capital. Education expenditure in the country is not robust enough to support the necessary quanta of human capital with its puny investment in education. It is, therefore, imperative for Nigeria to adopt a strategy which promotes provision of adequate funds for human capital development.

• Item Type: MPRA Paper
• Language: English
• Keywords: Human capital, fiscal stimulus, Bayesian VAR
• Subjects: I - Health, Education, and Welfare > I2 - Education and Research Institutions > I25 - Education and Economic Development; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I32 - Measurement and Analysis of Poverty

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