For citation:
Awuna, J. M., & Malkina, M. Yu. (2026). The Impact of Human Development on Sustained Economic Growth: Evidence from Nigeria. AlterEconomics, 23(2), 355–372. https://doi.org/10.31063/AlterEconomics/2026.23-2.6
Abstract:
This paper examines the influence of human development on sustained economic growth in Nigeria. Specifically, it investigates the combined effects of the Human Development Index, public expenditure on education and healthcare, unemployment rate, and foreign direct investment on the country’s economic growth. The study employs quarterly time series data sourced from the World Bank and constructs an Autoregressive Distributed Lag (ARDL) model to derive short-run and long-run coefficients reflecting the impact of the Human Development Index and public spending on education and healthcare on economic growth. The stationarity of the time series is assessed using the Augmented Dickey-Fuller (ADF) test, while the ARDL bounds cointegration test is applied to establish the presence of a long-run relationship. Diagnostic and stability tests were conducted to verify the accuracy and reliability of the model estimates. The study finds that in the short run, the Human Development Index, public healthcare expenditure, and public education expenditure all exert a statistically significant and positive effect on economic growth in Nigeria, while unemployment has a negative effect. In the long run, only the Human Development Index has a positive impact on economic growth, suggesting that sustained progress depends on comprehensive improvements in human development outcomes. The study concludes that public spending on healthcare and education serve as effective short-run instruments, while the Human Development Index functions as a long-run target indicator for achieving sustainable economic growth. This research adds to the existing body of knowledge by bringing together a range of human development indicators into a single, comprehensive ARDL model, drawing on the latest post-pandemic data. However, the study is limited by data interpolation and suggests that future research could explore the use of sector-specific human capital indicators and alternative econometric methodologies.
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