Human Capital-Growth nexus: the role of Government Spending on Education and Health in Nigeria

The link between economic development and human capital investment cannot be overemphasized. The 2015 Human Development Index (HDI) placed Nigeria in the 154th position out of 169 countries. Public spending on education and health care, being major determinants of human capital are generally low in Nigeria. Illustratively, the 2015 total national budgetary share to education and health was 6.36% and 7.01%, respectively (See, Budget Office of the Federation, 2015). The outcome of inadequate education and health spending has persistently lowered the standard of the sectors in the country. The foregoing suggests that human capital in Nigeria is severely under-developed. Therefore, this study examines the effect of government expenditure on education and health on economic growth using error correction modelling approach. The study concludes that human capital formation is key to national development