The Contribution of Local Government Expenditure on the Performance of Nigerian Economy

The study investigates the contribution of local government expenditure on the performance of Nigeria economy from 1993 to 2010 using empirical evidence from expenditure profile of the Nigeria local government. The study examines the basic features of local government spending: investment (capital) expenditure and consumption (recurrent) expenditure as they relate to the GDP over time (1993 – 2004). The findings of this study among others include: that local government expenditure contribute to Nigeria economy and that local government spending largely goes to recurrent expenditure (consumption) than capital expenditure (investment). Little effort was directed to capacity of initiating development projects despite the responsibility given to her to promote grassroots development. It is recommended that local government should improve in their revenue generating effort as this will increase their expenditure on both recurrent and capital spending vis-à-vis economic development.