Urhie, Ese S

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J un;v rsity of FL GOS. d At~ e ' \ - \ ~ J 1 ( n 1) l· "t l' i ,,,, \\\ l \ l\\ \1\ '' ''' \H t HOW I H IN NlC l• IU I\ 11.1', ON l' ltOM 'I 1m 0(1 \ NtHUW ( 'OUN 1 Ull•. \I \' \ \ I' \\ ' \ II N I U l I · ~ PNUt\11\ ·:d\NI l I 1\ •VI'It II'MJI.N I ~' II Jl> l l'.:i \ l 'I I I \ i l l ' I \\I I, INI·SS ANI l :;( H 11/\ 1 S< 'II •.Nl 'I •.S Vi\N1\ I\NI Nl ) I' M 10 II liH<>KO IHl/\1>, l' .M .II. I OJ.' ()'I 1\ U\1\ IN S'l /\'1'1:., Nl( IEIU/\ I: mui I: l'~dcc2000(illynhoo .co.uk Td: t 231\802150«)970 .\ l'Al'FR S\IUMlTTlm FOR THF. SKCOND ANNUAL CONFERENCE OF THE DEPARTMENT OF FINANCE, UNIVERSITY 0F LAGOS, NIGF.RIA THEME ,. ROADMAP TO VISION 2020:·ECONOMIC AND FINANCIAL PERSPECTIVE DATE: APRlL 22N° AND 23R0 2008 \ t>' l)l l ( . \ l H)l ll FCO NO I\ IH_· ( ; l~OWTH I N NHa:Rl A: l.l•:SSO S FROM Tl·ll<: G6 AN n HRt(' CO\ INTRIES . W STR CT 1 :hl tl:,· 'hlltt~t• 111 c•dncoltcl/1 o11d w/11• tlte (lllhhc sector sltould he more im•olved in its I ,, ., ' 1PU l \ Hl,l: ' ' c '"·' ·' · " '<'I toll c~t cotmtllcs. educotio11 \\'as fowul to he po.\ iti\'ely related to • < •''" m• ''lttf'lll I he 1111('111'1 of c·rltl\ ·ra/oll ' ·' more f lOit'lll 111 de,•elopm?, cmin1ries than in •• ,f,-,.,,, . ._.cl volmlr~c · , (/,c•. ''"''"~' '' "flOSifi\'C mul .\ i,l!.lli/icm rt rclotw/1\lup be tween government c'')YH,fltw •• 011 ,·,htt £If toll antltlf,· kwl c~f cclucotio11 '" c1 cmmtn• 111c l~\·el of commitment of tit\ \ ''.\;.fr/(lfl ( icl l 't'l'/1//lt'llt . ts 11111 adt'c{llfltl' to achl(' \'t' tile' IC' l 'ei o( economic 1(1'0Wt lt required to cl\111 \ '1' I 1 Ifill :o .. o /11 \'i, ·~, - of till.\ , tit~· if!c'l'lmt <im'C' nti/IC'I1f should accord the education srcfu,. tl1c l'' h"''l' 11 d<'.~cn·cs. 011c w ay to do tlus is to dc.(OiWt a pla11 for the sector. \N rt{()J)\ ICTlON l"h~: n·ali~..1tion t'l lk ' ~""' 2020 i ~ hinged on the attainment of not only a high ~~\'11\)lnl~ grrm th r.1h: but aL o a ust:1inablc one. , pccifically. it ha been estimated that an cr.1~e 0 r 12.4<> o \:.n"vth rate in <.iDP i. required to actualisc the dream of becoming one of .. 0 \argt'st ~(t)I\Om~t.' . by 2020. {St"~ludo 2007). This is definitely a Herculean task for a ' mt ry " ith ·"' i\\'Cragl..', (.~ I W gn'~wth rate ·or 5 - ~ he tween 200 1 and 2005 [National Bureau of t i ..,t k~ (NUS) _tlO('l · In Nd ., h \ pave ll)c wa t~w Nigeria to emerge as the next eleven in terms of total output. ~llludn CW07) '-111-!g_csh:d anwng \I her . . the incrca c in the commitment to education. l'his i. c.kfinitdy tl la l~tbbk '-llg~~sti,m. or all the I~\Clors that innuence economic growth -~wlitic .ll c ·, l ll<'ll\ i' and ~0( i.ll cdu <ll i0n has heen identified to be the mnst important ( nJrc''!:o" .()'C<,Ibghan. 2002. Hal,ntundc and A<.lefabi. 2005). Ideally. what poor economies \li lo..e ~'t. ·ri•~ ) need to achieve r.1pid :-md sustainable cc,momic pwgrc.ss is ideas and not obje~t (n tutrll n.~"(.Hirce. ). ldc:a~-ar~ gcm:r<lte-d from the \ callh of knowledge acquired hy it\d i viduu 1~ . Su ·h kniJ\\ kdg.(' n~·~Jcd tn pre.'' ide citi1cm ,f the P\'orc. t countr\ec; v. itb a vastly • I h 1\ I II I \h i\ , .... "f, ... 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I' t y l\ 11 • ltl . td.ftll••lt l ot llt a 11•\• ""' 11 11111 "' 1\ "' ,, "' ' h ·"'" ,, II II ttl II ' u•11 r ''"''"Y ' "I'" 11,, 1 ~ " ,., , ""'"'' '" " " '"' ,,,,, "' ,,, "' I·'" " , '"''I"' . 2.l Fduc tfiutt :uul I· ' tiiWIItH ( ;, "" th ( l 111 1111pa11 I 1111 It .II li lt I" tt u h Il l t d11~ tl tttll ' ' tit tl 1 h•· ~··,t In dt lltl ll l~ 1'1•1\\ llt h, t .w.tlll' 1!11 · ~til · .md 1 tp.n lilt . 11 ! ,, 1 ~tllnlr't " l,lw 111 It ll ' Ht ll 1t ~ l,, .,. · ... r dm . tll <ll t. l l .t• '" 11 11 ·, 1 '\l111t11 , , l. tJ• 111 . t lnttt.t I II 1\ '' " l tti C II I ttl'. to h. \1~ 1 fh I j J f.ttl ' 1'''1 ) {1(1 '\ lil t- t•, IIIII 11111) \\ Ill II I dtt .1111111 I • , 1' "t I II• I \\tilt II l.tl\oall l l 111~ l .l ll\,l lll II .d ,'1 ll .t• I l tc·\ I ''" II\··" II "'""'" ''"'' (I N l H' .'Ill) I 711) t 11 t l jll 11th the l.t~ ( t•u l d J,.·~•'ll l\ ' h n t ft 1~ l iiH" •fll ll lll lll t l111.11l1o11 l\\tWIJI• tl o• 111111\tolll.ll , "'" ' , ,tfulllt•' Wntlct 1 •• , 1 \o\ ltc•h t 11 !Itt' tndt v tdllal , II llll jll ll\11 . Itt. lu.11tlt , ltu l nltl llltt •ll j •lt WIII•II\11 )" 1111d f' .tltltll•' . lith 1 .•. 1 P"'" ' • •'\ li l t, lo l"m••IIIJ' I tl " 1" • t t \" 1 r .r 111 1 ' t '"~' t lu .lt••nr·· t P• '"'" ' ,,f 1 1H r t lnt · ' '" n r c<l tto , .• , t •ll h ra I• t ltl tl ) ' · ' ' ·• 1.,,,, • ittt.ull ·'"'' 1 htld ""'' I d•l \ 1'1 I \ q',lh Ill~·, • \\ \'t ,·r, .tn~t l nu ·r 'th.'ltl' ! _ ]·--I h tl\chold l \pcndtlu <'II nn,k C't: s F'\("lCnditun- including ~ocial Rcproducuon 4 .... r force >' . .. ·~; on :-a:~ anJ mm_ and f..e.--e-f&.> 1 o ·he " iet _. at rl:-t\ ~:<. a:ooonnc C\ ~ · Jon and £'Y. Y..1~ b: r r · i- g p~oouc: ,-. ,;~ ' -h ... ~to ig~ iocome ~nd imp-r''ed ~.Jnvm -• pe.rf:;.-rr::'"'te ll a~ <,.o coo ~~u· -.. t d - -• ... ~ o emoc~l7a1100. pe.1ce a:td o;e~nt~ as \\Ctl 3.S prom es • ..... .,. cvn~em fc-.r • .t: em i~onmer 1 r h - -• - • n "'- ·" C\ t e ~. '' ts generalt)o a..'-sc;tcd that a:1~ roucn tn 1 rs u:--.ble to dndop & ' ~ r.uma,c re. r~ co, ;an11~ t!~c:lop an::-lhing else. fd ar ebbofate 1~·~ o f t.:d;c,_ (~n ~ irnp:tt• f cd· ca:io:. ~ e ... or. ·mtc gT \\ 11. see Gk\H\ e. \ atga. and Zheng {2(Jfl7 . It i.: alY. im i e-Jucat; FigJre t i a :!g!t• modificat: of l ·op flll'del nf the th<: rdation-.hip l\-..een human dt--•.ck-p•nenr and ecuy mK l!f')V.\h lhe m<:<k:l n~a~~ lac' of education as a <otruclUral barner lo ~conom•c gr•J\\ h.(), the :::un:ra::-. a '"'i1..an~ ac.cumulatiC'):-a f i1 . ha<- intrinsic "alue fnr :Jetlpl .. - .,~ell-being. Ger.erail: . educati<m C(:tntril--cates to evmo·11•c grov.th ar.d raises poor ~ ~-._ ·ncor.-e 3. GI~OSS H0\1f:Sf'IC PRODl"CI. EDt C ·\TIO~ "iD GOVER:\\tE~"T £XP£~0ITI:JS.E 0~ f.DGCA TIO. - I~ THE G6. BRIC ;o.;o . "I I CO\::'\TRI Tab!e I bclc w ~'"'"i the G~<> Dom~tic Product (measured in 'SS Billion) of the ten rge-u ~tQrc<fmie> in lhe 'Aorld as at 2f.JOJ (note that L~e ranking is that based on PPPU S) .l"lle' inclu:de the ( J6 (Cmted States of America (LSA). Japan. German;, t.:nited Kingdom (UK,. France. and hal:' ] and the BRIC countries !Brazil. Russia. India. and China). lt also 1 ude-_, some of the emerging (C<! nomies - the ~ll tEg)-pt and , ' igeria). The table also ·;.·'> the tc; .. ·ct of edu<..atio-:1 1n these countsi~ as. ''ell as the lc 'ei of commitment to e< oca!i(:.o h} rhc g••\ emme-n~-. t•f lht.'<j.C countri~ Pr EGDP means ratio of public c;ector e,_pendiwrc ''" c<locatt:J!l to (JDP. "'"hile PEEIGt. mean~ ratlO of puhlic 5eetor e'\penditure to total ~overn.men~ e,.pendilure Incidentally, there "'ere no report on PEEGDP and PEETGE f'or Li!YPt and iger1a bel""'~en 2001 JP.d 2G05. Thus. Table 2 presents the le~d of . , -·· . . . .. ~- . :. ·. ( ... J ( VJ • \J9Ix • k I: (ll)p :-~nd l:ducnt inn . ( 1<>. llR IC and N I I Countr ies (·'O ~ ~nitmcntto F:ducatio; -U ' $ Bill io11 2001 l0Jl65"3 t 2003 I 0.94R ( 'apitn \\277 94 17.MK 9J --Pf:cGDP PEE1GE -- - -'l.6 15.5 'l.9 15.3 2005 12.416 Japan 2001 4.141.4 41 ,890 ,1)1 n.60I sn 5.9 15.3 -1.6 10.5 2003 4 .... 00 33,713 84 3.6 9.8 2005 4.534 J5.484 85 .9 l 6 9.8 Gcnnan)'2001 1,846 . 1 ---22.422 89 - - --4.6 9.9 2003 2,40., 29. I 15 89 4 .6 9.8 200 2,794 31.890 88 4 6 9.8 ----UK 2001 1.424. 1 ----24.2 19 I 12 4 .6 12.1 2003 1.795 30,253 123 12.1 5.4 2005 2.1 98 36.509 93 12. 1 5.4 France 200 1 1,309.8 22,129 91 I 1.4 5.7 2003 1.757 29.410 92 10.9 5.9 2005 2. 126 34,936 96.5 10 9 5.9 Italy 200 1 --------1.088.8 ------18.788 82 - 9.5 5.0 2003 1.468 25.47 11 87 9.6 4 .7 2005 1.762 . .10,073 98.4 4.9 9.6 .. ~- -·-- ---- --------·· 911 64 200 1 1. 159 2003 1,4 17 1.100 69 2.3 ---·- .. i3--~ 1.9 13 2005 2,234 1.7 12 69.1 I 1.9 13 -- "i .9t"5 ____ -- 260" - 502.5 ---- 95 I ---- ---- .. -- ------ -·- - -- - 1-·----- ! -- ·-- ~ ~-- ·- j 10 ~-- ____ ] 6 ... c li • ,,, t l •m II ,, h I\ HI lttf... 1 C,f)l• I ' IH J( ' . ~ '.:::.; · .. ... • I"• I (" w I . ,.<) (I 1 ~ J IIIC. {; mel •• fl rr\' cnl I() ,. 0 • !l! Jl fir C<}U Ill II the l'O HC • k MlC t hl' re •1ft ~'ih m bot~ \amp s Tile coefficient of. FUl \\Cre s1gr..fi~srh.e" ·re dtttcrcnt. V..hllc that (If the II cou•1trn \\ .& ·c pt fh(' te • test v.as conducted. The result "haws a uni-directional efTcct between education and economic growth. fhe re ult shows that education Granger causes GOP. • 4.2 Commitment Co Education in Nigeria Government expenditure as a rat1o of total government expenditure ranged between 5.8 and 9.2 between 200 I -and 2005' (sec Table 2). This figure is not only less than what obtained in any of the countries studied, it is also a far cry from the 26% prescribed by UNE CO. The highest proportion of education to GOP stood at 1.4% ( 2002). This ratio was less than I% for all other period between 2001 and 2005. This is quite low when compared ""ith figures from the G6 and I3RIC countries, which stood at a minimum of 9.6% during the period under review. Our findings supports the studies of other researchers sueh as Schultz, 1981, Andreosso-O'Callaghan, 2002. Heckman. ?002. and Babatunde and Adefabi, 2005 which attributed the devclopmeffi of the Amtrican economy. and many other countries across the worlc.i"to the development of their human capital - the knowledge and skills of the population. j ll"hus. the need for appropriate human capital development and accumulation is a prerequisite , or modern economic growth in both developed and developing countries. Similarly. our result on the effect of government expenditure on education supports that ofOmotor, 2004. -Policies Co Foster Educ~ttion and Promote Rnl>id Economic Growth in Nigeria An cffcct.ive policy and strateg~ for 'the Nigerian education sector must take the following facts into con.sideratiun. Firstly. the level of poverty is very high. This could intluencc parents to withdraw their children from school to engage in child labour in order to augment the income of the h<'usehold. Secondly. education is both a meril and public good. Consequently, the market wi ll be inefficient in alloe<1ting it. The essence of restructuring the )0 t)f;'\ T'' '~~ \11 ·I ' i.l( itlltl\, ltllt' tu ·. "l11d1 induuc cduc:-~tion . In view nf all these facts, we tl:" .llt, ''"~' ·,·h't I h" pl.111 "Ill ''n~.:hn'rtllc nlltht: fc:-tturc-. of the -;ector and stipulate I r~.\lt\lh t;H .,.,, "ludt •nu'-1 I · pt11 -..m·d, igot\lll\l) • .:) l h\ ·un.:nt 1 '11 ~.:~ h' lilx:raltt~ tlw ethtt::ltinn' sector is no d11uht n lnudablc one. This has led hl lhe ·t.thl• hm('nt of man~ pm ate universities. Two i<;c;ues of concern here arc (i) the high , ~~h '' lee .... "hi ' h m. de it unafTordablc by n vast mnjority of the populace, and (ii) the need u.t nt(" high quolity Roth i. <. uc call to r more go crnmcnt intervention t "1 k titn~in~ot clkch of\-Ju~ntion 6n cct~nomic development '>hould always form tire '" lt'r mvt:~tnwnt tn cdtt~.:attnn . l'his ic; hccausc of its c fTccts in the socio-economic and ~. Sl i;\1MJ\ tH' ANll CO CU JSION l11c '\llld~ c' .1111 Hcd the e1kt:t of education in economic growth in a cross-section of ~u.mtr i ~ . It .1ho n.llunt~cl!h<" cffcd s.lf government e. pcnuiturc on education. The G6, BRIC nu N 11 '-"ottnlt i(.~ "~re uc;cd .ts n ample. rhe result revealed a positive and signifi cant rei. u(,tl htp het\,~,.-cn cduclll()n ond ccnnumic growth on one hand and between government e'J'CmJitur!' unJ c\fu..:.itiNI 1 •.'11 the ,lthcr On the bao;is of the low level of education in Nigeria, t t \\ ru , ·~tc<l th.1t tlt~)rc prtMi t ~ -.huuld be .1 ~ordcd the education ector in order tor it to II • j . - ~ l • .. . . . I ... . ., ... The Challenges of SUSTAINABLE REDUCTION I IN NI.GERIA 

Education and Economic Growth in Nigeria: Lessons from the G6 and Bric Countries

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Education and Economic Growth in Nigeria: Lessons from the G6 and Bric Countries

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