FISCAL POLICY AND ECONOMIC DEVELOPMENT IN NIGERIA

ABSTRACT This study examines Fiscal Policy and Economic Development in Nigeria. Fiscal policy, which involves the use of government taxation, expenditure, and borrowing, is a key macroeconomic instrument used to influence economic stability and promote development. Despite various fiscal measures adopted by the Nigerian government over the years, the country continues to face challenges such as unemployment, inflation, poverty, infrastructural deficit, and slow economic growth. The main objective of the study is to evaluate the relationship between fiscal policy and economic development in Nigeria. Specifically, the study examines the impact of government expenditure, taxation, and public debt on economic development. The study adopted a descriptive survey research design, and data were obtained from both primary and secondary sources. The primary data were collected through structured questionnaires, while secondary data were obtained from journals, textbooks, Central Bank of Nigeria publications, and National Bureau of Statistics reports. The data collected were analyzed using simple percentages and frequency tables, while hypotheses were tested using statistical decision rules. The findings of the study revealed that government expenditure has a significant effect on economic development in Nigeria. It was also found that taxation contributes to economic growth, although its effectiveness is limited by poor administration and tax evasion. Furthermore, public debt was found to have both positive and negative effects on economic development depending on how borrowed funds are utilized. Overall, fiscal policy in Nigeria was found to be moderately effective but constrained by corruption, inefficient public spending, and policy inconsistency. The study concludes that fiscal policy is a vital tool for achieving economic development in Nigeria, but its effectiveness depends largely on proper implementation, accountability, and efficient management of public resources. The study recommends improved government expenditure management, strengthened tax administration, prudent debt management, and diversification of revenue sources.