The Impact of Infrastructure Governance on the Economic Growth of Nigeria

Abstract

This study examines the impact of infrastructure governance on economic growth in Nigeria using annual time-series data over the period 1995–2024. The empirical strategy employs the Autoregressive Distributed Lag (ARDL) bounds testing approach, incorporating structural breaks, lag dynamics, and a comprehensive set of post-estimation diagnostics to ensure robustness. The results confirm the existence of a strong long-run equilibrium relationship among the variables. The error correction term is negative and highly significant, indicating a rapid speed of adjustment of approximately 94% toward long-run equilibrium following short-run shocks. Empirical findings show that population exerts a strong and statistically significant positive effect on economic growth, while Research and Development has a significant negative impact in both the short and long run. Inflation exhibits weak and delayed effects, whereas governance effectiveness, foreign direct investment, infrastructure expenditure, and public debt are statistically insignificant across most specifications. Diagnostic tests confirm model stability, although mild evidence of non-normality, heteroskedasticity, and serial correlation is observed. However, structural stability tests (CUSUM and CUSUMSQ) indicate parameter stability over time, supporting the reliability of the estimated coefficients. The study concludes that Nigeria’s growth dynamics are driven more by demographic factors and infrastructure efficiency than by fiscal size or governance indicators alone. Policy attention should therefore shift toward improving infrastructure quality, institutional efficiency, and productivity-oriented public investment.