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Statutory Allocation and Budget Implementation in Southwest Nigeria

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DOI: 10.4236/jss.2019.77012    125 Downloads   244 Views


This study examined statutory allocation and budget implementation in Nigeria. This study covered all the six states of southwest geopolitical zone of Nigeria including Lagos State, Ogun State, Oyo State, Osun State, Ondo State and Ekiti State, over the period of 10 years spanning from 2008 to 2017. Data used in the study were collected from National Bureau of Statistics, Office of the Accountant General of the Federation, and annual budget of the selected states. The study made use of static panel estimation techniques such as pooled OLS estimator, fixed effect estimator and random effect generalized least square estimator, as well as Dumitrescu-Hurlin panel based granger causality test. Result showed that statutory allocation exerts insignificant, positive impact on actual expenditure to the tune of 0.109719 (p = 0.000 < 0.05), and that there is no existence of causal relationship between statutory allocation and actual expenditure of southwest states in Nigeria. The study thus established that though impact of statutory allocation on actual expenditure is positive, such impact is not significant in the context of southwest states, and that past period statutory allocation to southwest states does not significantly depict the level of budget implementation in the current period. In addition, this study established among other things that there is heterogeneity effect across southwest states in the discourse of statutory allocation and budget implementation. Thus the study underscores the place of states uniqueness in the matter of budget implementation. Hence state government especially in the southwest geopolitical zone should device budget implementation plan based on the reality, their revenue generating capacity, without much dependence on federal government allocation in other to improve the effectiveness and efficient of revenue mobilization and disbursement for project execution and state management for each fiscal year.

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Olaoye, F. and Bankole, T. (2019) Statutory Allocation and Budget Implementation in Southwest Nigeria. Open Journal of Social Sciences, 7, 125-135. doi: 10.4236/jss.2019.77012.

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