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IMPACT OF ELECTRICITY POWER ON ECONOMIC GROWTH IN NIGERIA: EVIDENCE FROM ARDL BOUNDS APPROACH
Abstract
The study investigates the impact of electricity power on the economic growth in Nigeria, covering the period between 1981 to 2019. Data on all the variables of the study were sourced from the World development indicators. Autoregressive Distributed Lag (ARDL) bounds test for cointegration was applied after confirming the existence of mix order of integration of variables via Augmented Dickey-Fuller test (ADF) and Phillip Perron (PP) unit root tests. Results of the study revealed that, electricity power is statistically positive and has significant impact on the economic growth in both the long run and the short run. While gross fixed capital formation is positive but statistically insignificant in affecting economic growth in the long run. Further result revealed that consumer price index is also positive and has significant impact on the economic growth during the period of the study. Based on the empirical findings, it is recommended that, there is need to improve and upgrade all sources of electricity power generations in the country to increase electricity supply. Grant and loans should also be given to public and private electricity transmission and distribution companies to upgrade their facilities to ensure uninterrupted electricity power supply for public and industrial consumption to boost economic growth in the country.
Keywords: Electricity power, economic growth, ARDL approach, Nigeria.