The effect of public spending on regional economic disparities in Nigeria: Evidence from Oyo State
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Background of the Study :
Public spending is a crucial instrument for redistributing resources and promoting balanced regional development. In Oyo State, government expenditure on infrastructure, education, healthcare, and social services from 2000 to 2020 has been pivotal in shaping regional economic disparities (Adeniran, 2023). Public spending policies are designed to reduce inequities by providing essential services to underdeveloped areas and stimulating local economic activities. However, the effectiveness of these measures is often challenged by misallocation of resources, bureaucratic inefficiencies, and corruption. Empirical studies have shown that targeted public spending can narrow income gaps and enhance human capital, yet poor implementation may exacerbate regional disparities (Oluwaseun, 2024). This study examines the relationship between public spending and economic disparities in Oyo State by analyzing fiscal data, development indicators, and qualitative insights from local stakeholders. The aim is to understand how variations in public expenditure impact regional growth and to identify policy adjustments that could promote more equitable development across the state (Chinwe, 2025).
Statement of the Problem
Despite significant public spending initiatives, economic disparities persist in Oyo State. Uneven allocation of resources and inefficiencies in public expenditure have resulted in marked differences in development outcomes between urban and rural areas (Adeniran, 2023). The gap between intended spending outcomes and actual economic improvements indicates that current policies may not be effectively addressing regional inequalities. This study seeks to investigate the factors contributing to persistent economic disparities and to evaluate the impact of public spending on regional development, with the goal of identifying strategies to optimize resource distribution and promote balanced growth.
Objectives of the Study:
1. To assess the impact of public spending on regional economic disparities in Oyo State.
2. To identify factors influencing the efficiency of public expenditure.
3. To recommend policy measures to promote equitable regional development.
Research Questions:
1. How does public spending influence regional economic disparities in Oyo State?
2. What factors affect the efficiency of public expenditure?
3. What policy reforms can reduce regional disparities?
Research Hypotheses:
1. Public spending positively influences regional development.
2. Inefficient expenditure practices exacerbate regional disparities.
3. Policy reforms can lead to more equitable resource allocation.
Significance of the Study (100 words):
This study is significant as it investigates the role of public spending in addressing regional economic disparities in Oyo State. Its findings will help policymakers understand the strengths and weaknesses of current expenditure strategies and develop targeted interventions to ensure balanced development. By identifying key challenges and proposing practical solutions, the research contributes to reducing regional inequalities and promoting a more inclusive economic environment (Adeniran, 2023).
Scope and Limitations of the Study:
This study focuses on public spending and its impact on regional economic disparities in Oyo State from 2000 to 2020. It does not extend to other states or non-fiscal factors influencing development.
Definitions of Terms:
1. Public Spending: Government expenditure on services and infrastructure.
2. Regional Economic Disparities: Differences in economic development levels between regions.
3. Fiscal Policy: Government strategies related to public spending and taxation.
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