INSTITUTIONAL QUALITY, GOVERNMENT EXPENDITURE AND ECONOMIC GROWTH- PANEL EVIDENCE FROM FOUR SELECTED WEST AFRICAN COUNTRIES
In line with the search for the real determinant of economic growth, this work sought to analyze the impact of institutional quality, government expenditure on economic growth, using a panel data analysis for four selected West African Countries (Nigeria, Ghana, Sierra Leone and Burkina Faso) from 2005 to 2013. The study found a positive and significant relationship between some institutions – economic institutions, on economic growth whereas political institutions showed a negative and insignificant effect on economic growth in Nigeria, Ghana, Sierra Leone and Burkina Faso. Also the empirical findings reveal a very positive and significant impact of government expenditure on economic growth and finally, structural policy institution was found to impact positively on the government expenditure outcomes in these countries, throughout the period of study. Based on the findings, the researcher recommends a concerted effort towards sanitizing the various institutions in order to improve on the policy making and execution of the various countries and by implication increase economic growth in countries. Also governments should channel their public expenditure endeavors towards the productive sector (Education, Health etc) and on the provision of the requisite developmental infrastructures. Finally, institutions play a vital role in the achievement of sustainable growth and development.
Keywords: Institutional quality, Government expenditure, Economic growth, Good Governance