Economic Growth and Demographic Dividend Nexus in Nigeria: A Vector Autoregressive (VAR) Approach

Abstract

In demography and population economics discourse, the macroeconomic implications of an upsurge in working age population, notably the labour force, on economic growth has been widely studied and the inherent beneficial impact has become known as demographic dividend. However, the exact mechanism linking the dividend to growth remains a perennial question. This motivates the current study to investigate empirically the dividend-growth nexus in the context of Nigerian economy in a multivariate VAR model spanning between the period 1970 and 2017. Specifically, the paper attempted to answer the question: Is the Nigerian Demographic Dividend an Education-triggered Dividend? Innovation Accounting Techniques was applied to assess the dynamic interactions among the variables. The empirical evidence obtained revealed that the innovation in gross enrollment made much contribution to the variation in economic growth relative to innovation in economic support ratio. The magnitude ranges between 20.09 and 27.54 percent. This result, thus, lend credence to the theoretical view of the education-triggered dividend model which ascribes to education twofold roles of helping to lessen fertility and also enhancing productivity but invalidates the conventional dividend paradigm.

Hydrochemical characterization of shallow and deep groundwater in Basement Complex areas of southern Kebbi State, Sokoto Basin, Nigeria

“…Nigeria is the fastest growing country in sub-Saharan Africa (SSA) in terms of the human population (Akombi et al 2019;Young 2019). Improved water supply which is one of the essentials for a healthy living has been constrained by uncontrolled anthropogenic activities (Vijay et al 2011;Qin et al 2013;Chen et al 2016;Chitsazan et al 2019) and by lesser extent natural conditions (Izah et al 2016;Makinde et al 2017;Zadawa and Omran 2018).…”

Untitled

“…Accordingly, the study revealed that both variables had a long-run relationship; moreover, uni-directional causality between population and economic growth running from former to the later was found. Ademola (2019) investigated the nexus between demographic dividend and economic growth in the Nigerian economy. By using time series data spanning from the year 1970 to 2017, and multivariate VAR model, their study showed that, the innovation in gross enrolment contributed to economic growth relative to innovation in economic support ratio.…”

“…According to Ademola (2019), econometric literature proposes, contingent on time-series features of variables, three distinct methodological alternates to empirically analyze the dynamic interactions between time series variables. These are, a VAR Model with the level, I(0) data, a VAR model with first-differenced, I(1) data, and a vector error correction model (Hundie, 2014).…”