EFFECT OF SOCIAL AND ECONOMIC SERVICE SPENDING ON SMEs’ GROWTH IN NIGERIA

Abstract

Despite the efforts of the government to develop the performance of SMEs in Nigeria, there are still major hurdles like poor infrastructure, limited access to affordable finance, and weak technological adoption. Therefore, this study investigated the effect of social and economic service spending on SMEs' growth in Nigeria. The study used the Bound test, ARDL and NARDL regression methods. Data estimated in the study were adopted from the CBN Statistical Bulletin and World Development Indicators for the period of 2000 to 2023. The findings of the study show that economic service spending has a significant effect on SME growth in Nigeria. The study recommends that the government should give more effort to both their economic and social service, specifically through human capital development and prioritising access to credit facilities, infrastructure development, and capacity improvement in ICT development, which could enhance SMEs’ growth.