The Effect Of Federal Expenditure And Money Supply On The Rate Of Unemployment (1989-2000), Abstract
This Study Is Motivated By The
Fact That Federal Expenditure And Money Supply As A Tool ...
This study is motivated by the
fact that federal expenditure and money supply as a tool on the rate of
unemployment. But to which extent, these instrument have contributed either to
worsen the problem of unemployment or alleviate it.
To investigate this problem,
two hypotheses were formulated as follows.
There is no relationship between money supply and
There is no relationship between federal expenditure
In testing the hypothesis, secondary data was used and analyzed using
regression and correlation analysis as well as student t-test. The following
are summary of the major findings from the analysis carried out in the study.
Federal expenditure and money supply contributed little to the reduction on the
rate unemployment between (1980-2000).
The package of National directorate of employment programme conmcerning
encouragement and generation of employment opportunities for most especially
school teachers from secondary school and graduate from higher institution
seems to be less vigorous since 1992 till date.
The inability of government of both federal and state levels to lift embargo on
public sector employment from (1994 to August 1999) could be partly responsible
for the high level of graduate unemployment in the Urban areas.
On the strength of the findings, the following recommendations were made.
The use of these tools (federal expenditure and money supply) need to be
reviewed to enhance their potential for addressing the rate of unemployment.
Alternative tools may be used to complement federal expenditure and money
supply towards the alleviation on the rate of unemployment.
The tool thrust should be the establishment of most micro-credit scheme to
assist enterprising unemployed people to set on micro business across the
There is need to build up human capital, this mean improving the knowledge,
shall, capacities and the mental and physical conditions of the masses.
TABLE OF CONTENTS
Background of the study
Statement of the problem
Objective of the study
Scope of the study
Significance of the study
Limitation of study
Definitions of basic concepts.
Review of Literature
Research deign and methodology
Area of study/coverage
Source of data / analytical techniques
Presentation and analysis of data
Presentation of table
Interpretation of table
Test of hypothesis
Summary of findings
Suggestion for further research
OF THE STUDY
Unemployment is an issue that has generated debates from every nook and cranny
of the world. Its impact was more, felt during the industrial revolution when
the dimension of man power absorption changed towards the consideration of
skill as a fundamental pre-requisite. However, over the years, government
around the world have been concerned with how the unemployment question could
be answered – similarly, the Nigeria economy was characterized by severe
unemployment, especially after the civil war which necessitated policy measures
aimed at reducing it’s.
Different government since 1970 till date have tried different strategies in
order to reduce unemployment, but the result still remain persistent
unemployment resulting in a number of social and economic problems like crime,
destitution, prostitution, corruption etc associated with it.
unemployment in Nigeria has assumed a frightened proportion. It is even more
frightened considering the fact that high rate of unemployment create poverty,
misery and threatens social cohesions reduction in the rate of unemployment has
thus become a major policy thrust of the government with the assistance of some
international agencies such as the international labour organization.
Moreover, since early 1970’s the revenue base of the country has depended
largely on the oil sector which has provided over 80% of total government
revenue. The growth of resource in the sector private opportunity to initiate
huge programme which substantially.
OF THE PROBLEM
Scrutinizing the time series
data on unemployment in Nigeria b/w 1960 and to mind 1980. Nigeria was at a
period of economic boom, which means unemployment was something nobody could
have dreamt about, but today unemployment has become so severe that nobody
likes to embrace it.
However, unemployment in
Nigeria is primarily youth unemployment, especially secondary school leaver for
instance in 1986, they constituted 65-3 percent of all the employed in Nigeria.
The figure for 1987 for this group was 70-7 percent when figures are
desegregated by location figures for Urban unemployment were higher for all the
years under survey with the exception of 1986. The national figures for
unemployment was 6.1 percent in 1986. It tell slightly to 5-3 percent in 1986
for all the year data indicate that unemployment was higher in the urban than
within the rural area.
Today, there is a nation wide
high rate of unemployment particularly among the youth that are leader of
tomorrow unemployment appear to be inherent in the nation economic system,
first, because intentionally or unintentionally the policy maker do not resort
to measure capable of reducing unemployment to an acceptable level.
Furthermore, tax collected from
companies an private individual are misappropriated. The expenditure on capital
project are divested to private purses whilst expenditure on personnel
emolument are delayed by government officials.
This study is therefore
concerned with finding out the effect federal government expenditure and money
supply on rate of unemployment. Also, intend to investigate clearly the extent
to which these policies have contributed to worsen the problem of unemployment
or alleviate it completely.
OF THE STUDY
The objective of the study is to make some reasonably investigations and, then
find out some facts paltering to the rate of unemployment and it level of
existence in Nigeria.
Hence, the research work will go as far as tracing the root of the problem,
ever increasing number of the unemployment rate among Nigerian and the cause of
it, mostly especially our youth.
To determine the effect of federal expenditure & money supply on the rate
of unemployment in our society.
ascertain the efforts and inputs of past and present government in the area of
skill or rented or vocational educative programme in our school toward solving
the problem of unemployment.
To examine the statistical application of the study, that will help to enhance
the empirical finding the effect of federal expenditure & money supply.
determine a suitable solution toward changing and alleviating the problem of
unemployment in our society.
What are the effect of federal expenditure and money supply in changing rate of
unemployment in Nigeria?
Does the government make any effort in increasing the education programmes in
our school towards changing the rate unemployment?
What are the problems associated in using statistical application.
What are the effect of the policies the government have used to change the rate
of unemployment in Nigeria.
What extend have the policies be used.
Unemployment has been
characterized as one of the major attributes used to distinguish developing
nation such as Nigeria, from most developed nation, such as U.S.A. in fact, the
rate at which this phenomenon has been skyrocketing in Nigeria has become much
more alarming and beyond expectation.
There is no significant relationship between money supply and
There is significant relationship between money supply and employment.
There is no significant relationship between federal expenditure and
There is significant relation between federal expenditure and
Hi: Alternative hypothesis
OF THE STUDY
In our nation Nigeria, it has
been confirmed and indeed apparent that no social or economic welfare equaled
finding job for the jobless citizens among us. In fact this has created a
dilemma that has inspired the researcher to investigate the roles played by
government on the changing or rat of unemployment at a goal.
Therefore, the result of this
research will help the provision of much needed information that would enhance
the creation of more employment opportunity for the masses in the society, and
these jobs may possibly come from three tiers of government (ie) Federal, state
& local the private and the citizens themselves.
Much more than that the result
will serve as a guide to the government and other employers toward initiating
programs for employment of the jobless Nigeria scattered all over the country.
OF BASIC CONCEPTS
This is constructing to be
action by the monetary authorities to influence the national economic objective
by controlling or influencing the quantity and direction of money supply,
credit and the cost of credit. If is aimed at ensuring adequate supply of money
to support financial accommodating for growth and development programs on the
one hand and, stabilizes various sector of the economy for sustainable growth
and development on the other hand, monetary policy is defined as policy
employing the Central Bank Control of the money supply as an instrument for
achieving the objective of economic policy. Similarly from synthesis of most of
the literature and in the context of the Nigeria.
The ultimate targets of the
monetary policy within the time frame are:-
Helping to stabilize the economy.
Enhancing the efficiency of resources use
Sustained increase in growth and output
Supporting output and employment growth.
The is defined as government expenditure as taxes, borrowing and financial
administration to further national economic objective – Government uses it
expenditure and revenue activities to effect desired changes in income,
production, prices and employment.
These changes concern national economic objectives which are targets of
monetary & fiscal policy and include acceleration of economic growth and
development, balance of payment equilibrium, price stability and reduction of
rate of unemployment.
The main target of federal expenditure
Within these period are:-
Maintenance of economic equilibrium part to certain inflation, pressures
accelerate economic growth and development.
Job creation and employment
Promotion of self-reliant development
This is the inability of economic cum society provide an opportunity for
individual eligible (eg) 18 to 65 years old to work and to exercise their ability
for exchange for emoluments. Hence, rendering such skills redundant and useless
in the environment through unemployment is a worldwide phenomenon, it has
assumed alarming dimension in Nigeria since the year 1980’s.
Types of unemployment.
ü Above equilibrium unemployment
ü Demand Deficient unemployment
ü Structural unemployment
ü Frictional unemployment
ü Seasonal unemployment
ü Equilibrium unemployment
ü Regional unemployment
This means that those who are
eligible and willing to work at the prevailing rate of pay are able to find
work without undue for difficulty.
This result when through one is employed; one is not making full use of ones
ability or skill in job place, or working below capacity. It results in
Person who constitute the supply of labour for production processes, they are
usually between the age of 15-19yrs. This exclude, student, homemaker, related
person, the disable and those not interest in work.
COMPANIES INCOME TAX (C.I.T)
This is a tool for revenue generating by taxing the private business enterprise
It is a way a generation of revenue, through taxes that individual or business
do not directly pay for, they include, excise duties, import duties value added
taxes, sales tax (etc).
GOVERNEMTN RECURRENT EXPENDITURE (RECEX)
These are spending on running cost of the day today running of the economy and
government affair such as emolument.
GOVERNMENT CAPITAL EXPENDITURE (CAPEX)
It is one of the fiscal tools, which entail expenditure on capital projects.
That is spending on structure, physical asserts such as: schools, roads bridges
airports and all forms of social and economic infrastructure facilities by the
Central Bank of Nigeria (1998)
Economic and financial Review
vol. 36 June, P.2.
Ojo M.O. (1995),
Reflection on some critical
Management in Nigeria.
Presidential Address at the
Conferences of Nigeria
Economic society, Lagos, PP.
Oruwaorie G.C. (1998),
Direct and Indirect contribution
of NDE in Nigeria War against
Unemployment. “A case study”
paper presented at a training
Ojo, M.O. (1999),
Monetary, credit and other
policies, in the 1996
federal government budget. “In
Bullion publication of CBN, Vol.
23 No 1
Ojo, M. O. (1999),
A review and appraisal of the
sector policy measure in the
federal government budget for
Bullion publication of the
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