ASSESSING THE IMPACT OF GOVERNMENT CAPITAL EXPENDITURE ON ECONOMIC GROWTH IN NIGERIA:A COMPARATIVE ANALYSIS OF ECONOMIC SERVICES AND ADMIN SERVICES.

This study examines the impact of government capital expenditure on economic growth in Nigeria, with a comparative analysis of expenditures on economic services and administrative services over the period 1990-2022. Data were sourced from the Central Bank of Nigeria (CBN) Statistical Bulletin, and the methodology employs the Autoregressive Distributed Lag (ARDL) model for both long-run and short-run estimations. The analysis reveals a significant relationship between government capital expenditure and economic growth, with distinct effects based on the type of service funded. In the long run, the results show a positive and statistically significant impact of both economic and administrative services expenditures on real GDP. Administrative services demonstrate a particularly strong influence, highlighting their critical role in promoting economic stability. However, government capital expenditure itself shows a negative relationship with economic growth, suggesting inefficiencies or misallocations in public investment. This indicates that while administrative and economic services drive growth, broader capital expenditure may need improved targeting. The short-run results further suggest that changes in government capital expenditure negatively affect economic growth in the short term. However, expenditures on economic services and administrative services display positive effects, with administrative services having a particularly strong influence in promoting growth. These findings suggest that capital expenditure's effectiveness depends on its allocation, with targeted investments in economic and administrative services proving more beneficial for sustainable growth. The study recommends the Nigerian government implement rigorous evaluations of capital expenditure, particularly in sectors with high growth potential, alongside improving accountability in public resource management to optimize economic outcomes.