Education and economic growth in Nigeria: a case study.

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Obi, John
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Middle Tennessee State University
The existence of unemployed college graduates alongside a continued dependence of the Nigerian government on foreign specialists has prompted the questioning of the efficacy of education in Nigeria as a means of attaining economic growth and development. The discovery and exportation of crude petroleum and the subsequent jump in world prices of crude petroleum in the early 1970s were considered to be major contributing factors in the steady growth of school enrollment in Nigeria. Many studies have shown that enrollments generally increase as the national income increases. Enrollment growth in Nigeria has, however, been mainly linked with increases in oil revenue.
This study investigates a two-way relationship between education (represented by school enrollments) and economic growth (represented by gross domestic product per capita) in a simultaneous equation framework using Nigeria as a case study. The statistical data cover the period 1960 to 1983.
The study also examines the impact of some exogenous factors, including the Nigerian government's expenditures on education and health care, investment in fixed capital, value of crude petroleum produced during the period, and population growth management on school enrollments and economic growth. Results of the estimated system of simultaneous equations using the two-stage least squares (2SLS) procedure indicated that there is a significant negative relation between economic growth and school enrollment at the three education levels in Nigeria. Investment in fixed capital and the value of crude oil produced during the period were found to have statistically significant and positive influence on economic growth. The other exogenous variables considered (government expenditures on education and health care) exhibited no significant influence on economic growth during the study period.
The results also indicated that income growth had no significant impact on school enrollments at the three levels of education in Nigeria. Population growth, however, played a major role in the rise in enrollments at all levels of education. Exogenous variables, such as the value of crude oil produced during the period and government expenditures on education and health care, did not significantly influence enrollments at the three school levels.
Major Professor: Bichaka Fayissa.