Substance abuse and Human Capital Development in Nigeria: An Endogenous Growth Model

Abstract

Substance abuse has a detrimental impact on human capital development by eroding the physical, mental and educational foundation of the workforce. This study aims to interrogate the long-run relationship between Human Capital Development (HCD) and Substance Abuse 
Prevalence (SAP) in Nigeria economy. The data for substance abuse prevalence are extrapolated from the National Drug Law Enforcement Agency (NDLEA) Annual Report from 1993 to 2025. Human Capital Development is indexed by secondary school enrolment for the same period. Results from the Vector Auto Regressive Distributed Lag (VAR) techniques show that SAP has a significant Negative Impact on Human Capital Development in the short run, while the variable Capital Expenditure (CE) on substance abuse prevention shows a negative 
but significant impact on HCD. The results of the long-run analysis also show that SAP has a significant negative impact on HCD at the 1% level. Contrary to our a priori expectation, Capital Expenditure (CE) on substance abuse prevention has a negative but significant effect on HCD at the 5% level. Based on these findings, the study recommended that a massive preventive substance abuse education and enlightenment programme that emphasises a healthy lifestyle should be embarked upon in our educational institutions.