PUBLIC EXPENDITURE AND ECONOMIC GROWTH: JUSTIFICATION OF KEYNES HYPOTHESIS USING NIGERIAN DATA

Keynes advocated for an increase in the size of government spending, as surest and easiest way economy can overcome recession. Government spending is exogenous variable should be used a policy tool or instrument growth.This study attempts to test this postulation made by on public expenditure being growth-public model, growth driver, ascertaining its applicability Nigerian situation. Secondary Data was sourced analyzed using Vector Error Correction Model. Pre-estimation done determine stationarity co-integration status variables. The VEC result showed that there no long run causality between growth, thus refuting Keynesian hypothesis Nigeria. However, short affirmed capital caused while recurrent does not cause both short-run. concluded economic justified Nigeria long-run but accepted It therefore recommended experience rising over time which would spur them into development, must participation level private sector, reduce activities barest minimum. also channel ensuring peace security lives properties, provision goods.
 Keywords: Growth Driver; hypothesis; Nigeria; Public spending;