Authors :
Samuel Mbah Adamu; Binta Sule; Mela Tersoo; Nuga Shimbura; Queen U. Rimamskep; Shuyur, Jesse Isaac; Emmanuel Sabastine Nomiri
Volume/Issue :
Volume 8 - 2023, Issue 11 - November
Google Scholar :
https://tinyurl.com/yw3xp9ca
Scribd :
https://tinyurl.com/mrxyss6e
DOI :
https://doi.org/10.5281/zenodo.10245728
Abstract :
Nigeria's economy is expanding, and the
country has the human capital and economic resources
to lift millions out of poverty. Despite being Africa's
largest economy, economic inequality and its attendant
economic implications have reached alarming
proportions. Against this context, the study investigated
the impact of income inequality on Nigerian economic
growth. It used secondary time series data spanning the
years 1980 to 2022. The data set was initially checked for
stationarity using the Augmented Dickey Fuller (ADF)
test. In addition, the research method used Bound test
approach for examining long-run and short-run
asymmetry effects using Nonlinear Autoregressive
Distributed Lag Model (NARDL). The NARDL Bound
test verified that the variables in the research had a long-
run connection. It also demonstrated that the calculated
model correctly captures asymmetries in the responses of
the economic growth (GDPR) to changes in positive and
negative income inequality. The positive changes to
income inequality indicated an increasing but not
significant effect on economic growth while negative
changes to income inequality indicated an increasing and
significant effect on economic growth in the long-run.
On bases of these findings, the study recommended for
government and the private sector to step-up measure
for income redistribution through directly investing in
opportunities for the poor to boost their capacity in
generating income. Among such measures includes;
providing access for micro-credit facilities, prioritizing
investment in functional education and training as well
as healthcare facilities and making it accessible to the
people to increase the capacity of the human capital for
sustainable economic growth.
Keywords :
Income Inequality, Economic Growth and NARDL Model.
Nigeria's economy is expanding, and the
country has the human capital and economic resources
to lift millions out of poverty. Despite being Africa's
largest economy, economic inequality and its attendant
economic implications have reached alarming
proportions. Against this context, the study investigated
the impact of income inequality on Nigerian economic
growth. It used secondary time series data spanning the
years 1980 to 2022. The data set was initially checked for
stationarity using the Augmented Dickey Fuller (ADF)
test. In addition, the research method used Bound test
approach for examining long-run and short-run
asymmetry effects using Nonlinear Autoregressive
Distributed Lag Model (NARDL). The NARDL Bound
test verified that the variables in the research had a long-
run connection. It also demonstrated that the calculated
model correctly captures asymmetries in the responses of
the economic growth (GDPR) to changes in positive and
negative income inequality. The positive changes to
income inequality indicated an increasing but not
significant effect on economic growth while negative
changes to income inequality indicated an increasing and
significant effect on economic growth in the long-run.
On bases of these findings, the study recommended for
government and the private sector to step-up measure
for income redistribution through directly investing in
opportunities for the poor to boost their capacity in
generating income. Among such measures includes;
providing access for micro-credit facilities, prioritizing
investment in functional education and training as well
as healthcare facilities and making it accessible to the
people to increase the capacity of the human capital for
sustainable economic growth.
Keywords :
Income Inequality, Economic Growth and NARDL Model.
