Examining the Implication of Politics of Local Government Financial Autonomy on Developmental Outcomes in Nigeria: Evidence From Error Correction Model (ECM)

Hammed Adetola Adefeso


This study evaluates the impact of politics of local government financial autonomy on the developmental outcomes in Nigeria. The study relies on secondary data gathered from Statistical Bulletin and World Development Indicator (WDI) from 1991 to 2021. The study finds that, variables employed are not stationary at level and there is evidence of long run convergence in the model. Using the error correction model (ECM), the study finds that, given the politics that revolves around local government financial autonomy, it would have had insignificant positive impact on development even if the state Governors have not encroached into local governments’ financial allocation in Nigeria. Also, the study reveals that fiscal decentralization has insignificant positive impact on development in Nigeria. Therefore, to have an effective governance at lower tiers of government, the study concurrently recommends both local government financial autonomy and extension of control of corruption at lower tiers of government in Nigeria.


Local government; financial autonomy; ECM; Nigeria

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DOI: http://dx.doi.org/10.3968/12638


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