European Journal of Globalization and Development Research

Transcription

1 ISSN European Journal of Globalization and Development Research Joint Effects of Capital and Recurrent Expenditures in Nigeria s Economic Growth ONI Lawrence Babatunde ANINKAN Olubukola Omonike AKINSANYA Taiwo Adebayo

2 Joint Effects of Capital and Recurrent Expenditures in Nigeria s Economic Growth ONI Lawrence B, * ANINKAN Olubukola O. & AKINSANYA Taiwo A. Abstract This study investigates the joint effects of capital and recurrent expenditures of government on the economic growth of Nigeria using the ordinary least square method for estimating multiple regression models covering time period. The regression results showed that both capital and recurrent expenditures impacted positively on economic growth during the period of study. The recurrent expenditure has a stronger and more accelerating effect on growth than capital expenditure. This is attributed to the fact that capital expenditure which is not meant for immediate consumption is more prone to misuse and embezzlement, and also could make it to be less growth enhancing. The study therefore, among others recommends that government should diversify its revenue base so as to depend less on revenue from crude oil which may not be able to sustain the future level of demand for capital and recurrent expenditures that could stimulate rapid economic growth and development in Nigeria. Keywords: Capital expenditure, recurrent expenditure, economic growth, Nigeria * [Corresponding Author], [Babcock University, Ilisan-Remo, Nigeria], [onilawrencebabatunde@yahoo.com] [Gateway Polytechnic, Saapade, Nigeria], [dabukky@yahoo.com] [Federal College of Education, Abeokuta, Nigeria], [taiwoakinsanya96@yahoo.com] 530

3 INTRODUCTION Government expenditures are the expenses which government incurs for the maintenance of the government and the society in general (Oriakhi, 2004). Government expenditures are the expenses the government incurs in carrying out its programmes (Okoh, 2008). According to Anyanwu (1997), government expenditure involves all the expenses which the public sector incurs for its maintenance for the benefit of the economy. Generally, government expenditure in Nigeria can be categorized into two components parts namely capital expenditure and recurrent expenditure. Capital expenditure is incurred on the creation or acquisition of fixed assets (new or second-hand) while recurrent expenditure is incurred on the purchase of goods and services, payment of wages and salaries and settlement of depreciation on fixed assets. Increase in government expenditure on socioeconomic activities and infrastructural development is an impetus for economic growth in any country. Specifically, some of the reasons adduced for the increase in government expenditure overtime are: inflation; public debt; tax revenue and the population. In Nigeria, evidences show that the total government expenditure in terms of capital and recurrent expenditures have continued to rise in the last three decades. Expenditures on defence, internal security, education, health, agriculture, construction, transport and communication are rising overtime. For instance, government total recurrent expenditure increased from N4, million in 1980 to N36, million in 1990 and further to N1,589, in 2007 and later to N2,632, in 2011 while government capital expenditure rose from N10, million in 1980 to N24, million in Capital expenditure stood at N239, million and N759, million in 2000 and 2007 respectively and by 2011, it was N1,934, The various components of capital expenditure have risen between 1980 and Meanwhile, Keynes in his hypothesis draws a link between public expenditure and economic growth posited that causality runs from public expenditure to income, implying that public expenditure is an exogenous factor and a public instrument for increasing national income. According to Keynes, increase in government expenditure leads to higher economic growth. Contrary to this view, the neo-classical growth models argue that government fiscal policy does not have any effect on the growth of national output. However, it has been argued that government fiscal policy (intervention) helps to improve failure that might arise from the inefficiencies of the market. Similarly, Dar and Amir (2002) pointed out that in the endogenous growth models, fiscal policy is very crucial in predicting future economic growth. It is a common believe that government plays a significant role in the development of a country and public expenditure is an important instrument for a government to control the economy. Economists have been well aware of its effects in promoting economic growth. The general view is that public expenditure 531

4 either recurrent or capital expenditure, notably on social and economic infrastructure can be growth - enhancing. That is an increase in government expenditure will yield a positive increase in the growth of the economy by increasing the national income, especially when it is injected in development programs (Omoke, 2009). For example, government expenditure on health and education is capable of raising the productivity of labour and increase the growth of national output (Oni, 2014). Similarly, expenditure on infrastructure such as roads, communications, power, etc, reduces production costs, increase private sector investment and profitability of firms, thus fostering economic growth. However, some scholars did not support the claim that increasing government expenditure promotes economic growth, instead they assert that higher government expenditure may slowdown overall performance of the economy. For instance, in an attempt to finance rising expenditure, government may increase taxes and/or borrowing. Higher income tax discourages individuals from working for long hours or even searching for jobs. This in turn reduces income and aggregate demand. In the same vein, higher profit tax tends to increase production costs and reduce investment expenditure as well as profitability of firms. But in Keynesian s view government expenditures boost economic growth, particularly in times of economic stagnation. This is also consistent with the view expressed by Olukayode (2009) that public expenditure either recurrent or capital expenditure, notably on social and economic infrastructure can be growth-enhancing. In line with this view, the rising government expenditure in Nigeria is expected to translate into meaningful growth and development but Nigeria still ranks among the poorest countries in the world today while many Nigerians have continued to wallow in abject poverty with more than 50 percent living below US$2 per day and less than 2 percent are abnormally rich. Bad roads and epileptic power supply have led to the collapse of many industries accompanied by high level of unemployment and abandonment of projects. In addition, the macroeconomic indicators such as balance of payments, import obligations, inflation rate, exchange rate, national savings, foreign reserves, debt profile and mortality rate are all showing that Nigeria is not doing well economically in the last couple of years. With all the aforementioned experiences in Nigeria, this study finds it necessary to re-examine the impact of government expenditure on economic growth in Nigeria. The variables of government expenditure are total capital expenditure and total recurrent expenditure at disaggregated level. Economic growth is measured by real gross domestic product. The study which covers a period of 32 years ( ) is carried out to compliment the work of other researchers who had carried out a similar study in Nigeria. The paper is presented as follows; the introductory section is followed by the literature review; the next section presents the methodology of the study; while section four is for data analysis and discussion of result. In section five, policy recommendations are made and section six concludes the paper. 532

5 2. LITERATURE REVIEW Empirical researches on the effect of government expenditure on economic growth reported results such as: positive effect, negative effect, and those who observed mixed results and those who could not establish any relationship between government expenditure and economic growth. The first school of thoughts are those who support the idea that public expenditure has negative impact on economic growth. According to Husnain et al., (2011), public spending is negatively correlated with economic growth due to inefficiency of the public sector especially in the developing countries where large proportion of public spending is attributed to non-developmental expenditure like defence and interest payments on debt. Laudau (1983) examined the effect of government (consumption) expenditure on economic growth for a sample of 96 countries, and discovered a negative effect. Taban (2010) examined the relationship between government spending and economic growth for the period 1987 to 2006 by applying bounds testing approach and MWALD Granger causality test. The author found that the share of government spending and share of investment to GDP have negative impacts on economic growth in the long run. Devarajan, Snoop and Zou (1996) studied the relationship between the composition of government expenditure and economic growth for a group of developing countries. The regression results illustrated that capital expenditure has a significant negative association with growth of real GDP per capita. Similarly, Ighodaro and Okiakhi (2010) used time series data for the period 1961 to 2007 and applied Co-integration test and Granger causality test to examine the growth effect of government expenditure disaggregated into general administration and community and social services in Nigeria. The results revealed negative impact of government expenditure on economic growth. Mitchell (2005) argued that the American government expenditure has grown too much in the last couple of years and has contributed to the negative growth in GDP. The author suggested that government should cut its spending, particularly on projects/programmes that generate least benefits or impose highest costs. Moreover, Vu Le and Suruga (2005) investigated the simultaneous impact of public expenditure and foreign direct investment (FDI) on economic growth from a panel of 105 developing and developed countries for the period 1970 to 2001 and applied fixed effects model and threshold regression techniques. Their main findings were categorized into three: FDI, public capital and private investment play roles in promoting economic growth. Secondly, public non-capital expenditure has a negative impact on economic growth and finally, excessive spending in public capital expenditure can hinder the beneficial effects of FDI. Similarly in Sweden, Peter (2003) examined the effects of government expenditure on economic growth during periods. The author emphasized that government spend was too much and it might slowdown economic growth. 533

6 The findings above, however, have been challenged by numerous other works. For example, Al-Yousif (2000) indicated that government spending has a positive relationship with economic growth in Saudi Arabia. Komain and Brahmasrene (2007) examined the association between government expenditures and economic growth in Thailand, by employing the Granger causality test. The results revealed that government expenditures and economic growth are not co-integrated. Moreover, the results indicated a unidirectional relationship, as causality runs from government expenditures to growth. Lastly, the results illustrated a significant positive effect of government spending on economic growth. Alexiou (2009) used pooled time series and cross-section data for 7 countries in the South Eastern Europe (SSE) spanning from 1995 to 2005 to carry out a survey study. The results indicates that out of five variables used in the estimation, government spending as dependent variable on capital formation, development assistance, private investment and a proxy for trade-openness all have positive and significant effect on economic growth, in contrast, population growth was found to be statistically insignificant. The inconsistent relationship between public expenditure and economic growth is also supported by the findings of Olukayode (2009) who investigated the impacts of government expenditure on economic growth in Nigeria using time series data from 1977 to 2006 and adapting Ram (1986) model in which government expenditure is disaggregated into private investment, human capital investment, government investment and consumption spending at absolute levels. The results showed that all the expenditures have positive effects on economic growth. Also, Oni, (2014), carried out an analysis on the growth impact of health expenditure in Nigeria by employing multiple regression technique. The result showed that total health expenditure, gross capital formation and labour force productivity are important determinants of economic growth in Nigeria while life expectancy impacted negatively. It was observed from the study that increase in health expenditure over the years has raised the level of national income by enhancing the marginal productivity of labour as an average worker lives healthier and contributes more to gross domestic product (GDP) but that, lives are however, being shortened due to socio-political problems, incessant road accidents and other social violence ravaging the country. Ram (1986), on his own part studied the linkage between government expenditure and economic growth for a group of 115 countries during the period The author used both cross section, time series data in his analysis, and confirmed a positive influence of government expenditure on economic growth. Another study by Jiranyakul and Brahmasrene (2007) investigated the relationship between government expenditures and economic growth in Thailand for the period 1993 to 2006 and employed Standard Granger Causality test and Ordinary Least Square (OLS) method. The results showed a unidirectional causality from government expenditure to economic growth without feedback. Furthermore, 534

7 estimation from the ordinary least square confirmed the strong positive impact of government expenditure on economic growth during the period of investigation. Bose et al. (2003) also examined the effects of government expenditure for a panel of 30 developing countries over the decades of 1970s with a particular focus on sectoral expenditures and employed Seemingly Unrelated Regression technique. Their results revealed that the share of government capital expenditure in GDP is positively and significantly correlated with economic growth with the exception of recurrent expenditure which is insignificant. Furthermore, Dilrukshini (2002) analyzed the relationship between public expenditure and economic growth in Sri Lanka over the period 1952 to 2002 and applied Johansen co-integration technique and Granger causality test. The findings suggest that the growth of public expenditure in Sri Lanka is not directly dependent and determined by economic growth. Some studies also found mixed results on the impact of government expenditure on economic growth, for instance, Abu and Abu (2003) employed multivariate co-integration and variance decomposition approach to examine the causal relationship between government expenditures and economic growth for Egypt, Israel, and Syria. In the bivariate framework, the authors observed a bi-directional (feedback) and long run negative relationships between government spending and economic growth. Moreover, the causality test within the trivariate framework (that include share of government civilian expenditures in GDP, military burden, and economic growth) illustrated that military burden has a negative impact on economic growth in all the countries while civilian government expenditures have positive effect on economic growth for only both Israel and Egypt. Deverajanet al. (1996) shed light on the composition of public expenditure and economic growth for the panel of 43 developing countries from 1970 to 1990 and applied Ordinary Least Squares. Their findings suggest that increase in the share of recurrent expenditure has positive and statistically significant growth effects and by contrast, capital as a component of public expenditure has a negative impact on economic growth. These results, according to the study imply that, developing countries governments have been misallocating public expenditure in favour of capital expenditures at the expense of recurrent expenditures. Olugbenga and Owoye (2007) investigated the relationships between government expenditure and economic growth for a group of 30 countries during the period The regression results showed the existence of a long-run relationship between government expenditure and economic growth. In addition, the authors observed a unidirectional causality from government expenditure to growth for 16 of the countries, thus supporting the Keynesian hypothesis. However, causality runs from economic growth to government expenditure in 10 of the countries, confirming the Wagner s law however, the authors found the existence of feedback positive relationship between government expenditure and economic growth for a group of four countries. 535

8 From other studies, Belgrave and Craigwell (1995) examined the impact of government expenditure on economic growth disaggregating the level of government expenditure on economic growth into functional and economic categories of Barbados for the period and employed Augmented Dickey Fuller and Engle and Granger co-integration technique. Their results revealed that there is a positive relationship between capital expenditure, agriculture, housing and community, road, communication and health expenditures on economic growth respectively. However, the effects of education and recurrent expenditure are negative. Niloy, Emranhul and Osborn (2003) used a disaggregated approach to investigate the impact of public expenditure on economic growth for 30 developing countries in 1970s and 1980s. The authors confirmed that government capital expenditure in GDP has a significant positive association with economic growth, but the share of government recurrent expenditure in GDP was shown to be insignificant in explaining economic growth. At the sectoral level, government investment and expenditure on education are the only variables that had significant effect on economic growth, especially when budget constraint and omitted variables are included. In India, Ranjan and Sharma (2008) examined the effect of government development expenditure on economic growth during the period They discovered a significant positive impact of government expenditure on economic growth. They also reported the existence of co- integration among the variables. Finally, Donald and Shuanglin (1993) investigated the differential effects of various forms of expenditures on economic growth for a sample of 58 countries. Their findings indicated that government expenditures on education and defence have positive influence on economic growth, while expenditure on welfare has insignificant negative impact on economic growth. 3. DATA AND METHOD OF ANALYSIS 3.1 Data The data used for this study are basically time series data covering , that is thirty-two (32) years. The data were sourced from Central Bank of Nigeria (CBN) Statistical Bulletin. 3.2 Model specification Following Okoro (2011) government expenditure (capital and recurrent) is considered as independent factor of production. This is presented in Cobb-Douglas production function with constant returns to scale as: RGDP = αtceβ1treβ2µ...(1) Where RGDP is defined as real gross domestic product (output), α is the total factor productivity; TCE is government total capital expenditure; TRE is government total recurrent expenditure; β1 and β2 are the constant elasticity coefficients of capital and recurrent expenditure respectively. The logarithmic conversion of the equation above yields the structural form of production function as: Logrgdp = Logα + β1logtce + β2logtre + µ ---- (2) 536

9 Where Logrgdp = Log of Real Gross Domestic Product. Logα = β0 is the intercept. LogTCE = Log of total capital expenditure on education defined as expenditure incurred on the creation or acquisition of fixed assets (new or secondhand). LogTRE = Log of total recurrent expenditure defined as expenditure incurred on the purchase of goods and services, payment of wages and salaries and settlement of depreciation on fixed assets. µ = white noise error term. Apriori Expectation: β0> 0, β1>0, β2> RESULTS AND DISCUSSION Table 4.1 which is shown as appendix A contains multivariate regression results for the growth model. The results indicate that the coefficient of total recurrent expenditure and the constant are statistically significant. Precisely, the coefficient of total recurrent expenditure (TRE) is found to be statistically significant at 1 percent level as indicated by its probability value and rightly signed (positive). This therefore, implies that 1 percent increase in total recurrent expenditure raises the economic growth (RGDP) by 92.3 percent. The coefficient of total capital expenditure though not statistically significant but is consistent with the theoretical expectation and found to be positive (i.e. β1> 0). This also implies that 1 percent increase in total capital expenditure (TCE) raises the economic growth (RGDP) by 2.7 percent which is found to be statistically insignificant, indicated by its high probability value This high probability value implies that the presence of that effect that can invalidate the parameter is high (92.9 percent). The F-statistics , which is a measure of the joint significance of the explanatory variables, is found to be statistically significant at 1 percent level as indicated by the corresponding probability value The R ( %) implies that percent total variation in the RGDP is explained by the regression equation. Coincidentally, the goodness of fit of the regression remained high after adjusting for the degree of freedom as indicated by the adjusted R 2 (R 2 = or %). After observing the Durbin-Watson statistic in table 4.1 to be lower than R indicating that the model is spurious, the need for a unit root test became obvious. Therefore, a Unit root test was conducted after which the model is found to be nonspurious (meaningful), indicated by Durbin-Watson statistic of and R which is shown on table 4.2 as appendix B. 5. POLICY RECOMMENDATIONS The above findings have important policy implications. The findings show that capital expenditure contributes minimally to growth as compared to the higher contributions from recurrent expenditure. This is 537

10 probably because capital expenditure which is not meant for immediate consumption is more prone to misuse and embezzlement. This could make it to be less active in promoting growth. However, government should increase total expenditure by spending more on various sectors of the economy. Most importantly, government should diversify its revenue base so as to depend less on revenue from crude oil which may not be able to sustain the future level of demand for capital and recurrent expenditures that could stimulate rapid economic growth and development in Nigeria. Agricultural source of revenue should be revitalized by increasing agricultural productivity while industries are activated to earn more revenue from industrial sector. Government capital spending in industries and agriculture should be properly managed and monitored so as to raise the nation s production capacity and employment, which in turn raises the level of economic growth in Nigeria. Furthermore, government should increase its expenditure on rural development, roads, water and electrification in order to accelerate the level of productivity, increase income and raise the standard of living of poor citizens in Nigeria. Finally, there should be a high degree of transparency and accountability in government spending. Anti-graft or anti corruption agencies like the Economic and Financial Crime Commission (EFCC), and the Independent Corrupt Practices Commission (ICPC) should be practically independent to enable them be more functional and forceful in their actions. There should be independent judicial system so that those who divert and embezzle public funds in Nigeria would be brought to book and decisively dealt with without any prejudice. According to Oni, (2014), government should ensure the free operation and enforcement of the rule of law, guarantee the freedom of the press and be sincere in fighting corrupt practices both in private and public sectors. 6. CONCLUDING REMARKS This paper investigates the impact of total capital expenditure and total recurrent expenditure on economic growth in Nigeria through the use of ordinary least square multiple regression analytical method. It is therefore established by the study that total capital expenditure and total recurrent expenditure are important determinants of economic growth in Nigeria. The outcome of this result is consistent with and strongly upheld the Keynesian s view that government expenditure causes economic growth. The regression results, however, reveal that the total recurrent expenditure is characterised by the higher positive value of coefficient as compared to that of the total capital expenditure. The results also reveal that every wellutilized naira unit of capital and recurrent expenditure has the ability to impact positively on economic growth of Nigeria. A good performance of an economy in terms of per capita growth may therefore be attributed to a 538

11 judicious use of total government expenditure in Nigeria. The major policy implication of this result is that concerted effort should be made by policy makers to ensure that the disbursement of government expenditure to various sectors of the economy are well supervised and also ensure its adequate spending so as to boost the level of economic growth in Nigeria.. 539

12 References [1]. Abu-Bader S and Abu-Qarn A.S, (2003), Government Expenditures, Military Spending and Economic Growth: Causality Evidence from Egypt, Israel, and Syria, Journal of Policy Modeling, 25(6-7): [2]. Alexiou, C. (2009), Government Spending and Economic Growth: Econometric Evidence from South Eastern Europe (SSE). Journal of Economic and Social Research, Vol.11(1), pp.1-16 [3]. Al-Yousif Y. (2000), Does Government Expenditure Inhibit or Promote Economic Growth: Some Empirical Evidence from Saudi Arabia, Indian Economic Journal, Vol.48(2). [4]. Anyanwu, J.C., (1997), Nigerian Public Finance, Joanee Educational Publishers, Onitsha. [5]. Belgrave, A. and Craigwell, R. (1995), The Impact of Government Expenditure on Economic Growth in Barbados: A Disaggregate Approach, Research Department, Central Bank of Barbados. [6]. Central Bank of Nigeria, (2011), Statistical Bulletin, Abuja. [7]. Bose, N.; Haque, M.E. and Osborn, D.R., (2003), Public Expenditure and Growth in Developing Countries: Education is the Key, Discussion Paper Series No. 80 [8]. Dar Atul A and AmirKhalkhali S, (2002), Government Size, Factor Accumulation and Economic Growth: Evidence from OECD Countries, Journal of Policy Modeling, Vol.24(7/8),pp [9]. Devarajan S.; Swaroop V.; Zou H., (1996), The Composition of Public Expenditure and Economic Growth, Journal of Monetary Economics, Vol.37, pp [10]. Dilrukshini, W.A. (2002), Public Expenditure and Economic Growth: Cointegration Analysis and Causality Testing, Staff Studies Central of Sri Lanka, Vol.34(1), pp [11]. Donald NB and Shuanglin L, (1993), The Differential Effects on Economic Growth of Government Expenditures on Education, Welfare, and Defense, Journal of Economic Development, 18(1). [12]. Ighodaro, C.A.U and Okiakhi, D.E. (2010), Does the Relationship Between Government Expenditure and Economic Growth Follow Wagner s Law in Nigeria?, Annals of University of Petrosani Economics, Vol. 10(2), pp [13]. Jiranyakul, K. and Brahmasrene, T. (2007), The Relationship Between Government Expenditure and Economic Growth in Thailand. Journal of Economics and Economic Education Research, Vol.8(1), pp [14]. Komain J, Brahmasrene T, (2007), The Relationship Between Government Expenditures and Economic Growth in Thailand, Journal of Economics and Economic Education Research, Vol. l1(2) [15]. Laudau D. (1983), Government Expenditure and Economic Growth: A Cross Country Study, Southern Economic Journal, 49, [16]. Okoh, S.E.N., (2008), Public Sector Economics, Mindex Publishing Co., Benin City. [17]. 17) Okoro A. S.(2011), Government Spending and Economic Growth in Nigeria, Global Journal of Management and Business Research Economics and Commerce, Vol. 13 [18]. Olugbenga A. O, and Owoye O., (2007), Public Expenditure and Economic Growth: New Evidence from OECD Countries [19]. Olukayode, M. E. (2009), Does Government Spending Spur Economic Growth in Nigeria? MPRA paper No [20]. Omoke P. (2009), Government Expenditure and National Income: A Causality Test for 540

13 [21]. Nigeria, European Journal of Economic and Political Studies, Vo. 2: [22]. Oni, L. B. (2014), Analysis of the Growth Impact of Health Expenditure in Nigeria, IOSR Journal of Economics and Finance, Vol.3(1), pp [23]. Oriakhi, D.E., (2004), Introduction to Public Finance, Mindex Publishing Co., Benin City. [24]. Peter S (2003), Government expenditures effect on economic growth: The case of Sweden, , A Bachelor Thesis Submitted to the Department of Business Administration and Social Sciences, Lulea University of Technology, Sweden. [25]. Mitchell J D, (2005), The Impact of Government Spending on Economic Growth Backgrounder, [ [26]. Niloy B, Emranul H.M, and Osborn D,R, (2003), Public Expenditure and Economic Growth: A Disaggregated Analysis for Developing Countries [ [27]. Ranjan K. D and Sharma C, (2008), Government Expenditure and Economic Growth: Evidence from India, The ICFAI University Journal of Public Finance, Vol.6(3),pp [ [28]. Ram, A. (1986), Causality between Income and Public Expenditure: A Broad International Perspective, Public Finance/Finances Publishes,Vol. 31(3),pp [29]. Taban, S. (2010), An Examination of the Government Spending and Economic Growth Nexus for Turkey Using Bound Test Approach International Research Journal of Finance and Economics, Vol. 48, pp [30]. Vu Le, M. and Suruga, T. (2005): Foreign Direct Investment, Public Expenditure and Economic Growth: The Empirical Evidence for the Period , Applied Economic Letters, Vol.12, pp

14 TABLE 4.1: Regression Equation Result Dependent Variable: LOGRGDP APPENDIX A Method: Least Squares Date: 12/10/13 Time: 23:34 Sample: Included observations: 3 Variable Coefficient Std. Error t-statistic Prob. C LOGTCE LOGTRE R-squared Mean dependent var Adjusted R-squared S.D. dependent var S.E. of regression Akaike info criterion Sum squared resid Schwarz criterion Log likelihood Hannan-Quinn criter F-statistic Durbin-Watson stat Prob(F-statistic) APPENDIX B TABLE 4.2: Unit Root Test Results for the dependent variable LOGGDP Null Hypothesis: D(LOGGDP) has a unit root Exogenous: Constant Lag Length: 0 (Automatic - based on SIC, maxlag=1) t-statistic Prob. Augmented Dickey-Fuller test statistic Test critical values 1% level % level %level

15 Augmented Dickey-Fuller Test Equation Dependent Variable: D(LOGGDP,2) Method: Least Squares Date: 12/10/13 Time: 23:34 Sample (adjusted): Included observations: 30 after adjustments Variable Coefficient Std. Error t-statistic Prob. D(LOGGDP(-1)) C R-squared Mean dependent var Adjusted R-squared S.D. dependent var S.E. of regression Akaike info criterion Sum squared resid Schwarz criterion Log likelihood Hannan-Quinn criter F-statistic Durbin-Watson stat Prob(F-statistic)