Pattern of Growth, Socioeconomic Variables and Poverty Reduction in Nigeria: An ARDL Analysis

In view of the failure of economic growth that characterized most of the developing economies to result in substantial reduction in their poverty incidences, several attempts have been advanced the missing link between these variables. This study, therefore, investigated the impact of patterns of growth and socioeconomic variables on poverty reduction in Nigeria from 1981-2018. To achieve this, the study applied Autoregressive Distributed Lag (ARDL) technique to analyse time-series data sourced from Central Bank of Nigeria (CBN), National Bureau of Statistics (NBS) and World Development Indicators (WDI). The findings revealed that for both the long-run and short-run, growth in RGDP per capital emanating from agriculture (PCA) and industry (PCI) as well as inequality (INQ), inflation (INF), human capital (HC) and unemployment (UMP) have significant long-run relationship with poverty reduction at various levels of significant. Further to this, the short-run estimated results reveal that the lagged values of poverty reduction, pattern of growth, inequality, inflation, unemployment and human capital development have significant impact on poverty reduction for the present period. The study, therefore, concluded that even though all the variables have long-run and short-run relationship with poverty reduction in Nigeria, only the results for the variables PCA, PCI, INQ, INF, HC and UMP are statistically significant. Of all these variables that are statistically significant, growth in PCA and/or reduction in INQ have the highest potentials of achieving poverty reduction in Nigeria. Therefore, any policy formulation that is aimed at reducing poverty incidence in Nigeria must provide support to the agriculture sector and address the issue of income distribution.