The paper identifies a gap in the understanding

The gap

Evidence profile

Sourced from the future work and abstract and stated research gap of the source papers, classified as general, drawn from work published between 1986 and 2026, spanning 3 journals. Those papers have been cited 62 times in total.

Supporting evidence — 3 representative gaps

• Fiscal Deficit Financing Strategies and Human Development Outcomes in Nigeria (2026) · Journal of Global Economics & Sustainable Development · doi

  literature, namely, neoclassical, Ricardian, and Keynesian theories the research adopted a Keynesian framework. Methodologically, the study employed a Vector Error Correction Model (VECM) to analyze long-run causality. The significance of key model statistics (Wald and error correction term coefficients) confirmed a unidirectional causal relationship from budget deficits to the human development index, a finding the study discovered to be consistent with the Keynesian theory. The study concluded that for budget planning to be an effective fiscal policy instrument, the long-run and more permanent effects of deficits on human development must be a primary consideration. Monogbe and Okah (2017) examined the effect of deficit financing on Nigeria’s economic development within the context of theoretical debates between Keynesian, neoclassical, schools. The study is prompted by the paradox of Nigeria’s and Ricardian 2 https://journals.e-palli.com/home/index.php/jgesd Page J. Glob. Econ. Sustain. Dev. 2(1) 1-9, 2026high debt accumulation not translating into tangible development outcomes. Employing an error correction model and Granger causality tests for the period 1981 to 2015, the analysis revealed that the external debt exhibited a statistically significant positive relationship with economic development, albeit with a minimal coefficient (0.0173). Conversely, neither domestic debt nor the budget deficit itself demonstrates a causal link to development. The study, therefore, concluded that deficit financing, specifically through external debt, can act as a vital developmental stimulus, affirming the Keynesian postulate. The study recommended the prudent and coordinated management of borrowed funds, ensuring they are invested in capital and productive sectors to foster sustainable economic development. Employing a dual-methodological framework, Udeaja and Akanni (2024) examined the nexus between fiscal deficits and human development in Nigeria from 1990 to 2021. Their application of an ARDL model found no statistically significant linear relationship in the short run or the long run. In contrast, a multivariate adaptive regression spline analysis uncovered a critical nonlinear threshold: deficits enhanced human development below 1.34% of GDP but constrained it beyond that point, which suggested fiscal sustainability constraints. They believed that this negative effect could be reversed with robust economic capacity. The research emphasized electrification as a pivotal determinant of development and advocated for a policy framework of targeted deficit spending in priority sectors, fiscal rule enforcement, and sustained investment in infrastructure to promote sustainable human development. Suotor et al (2025) adopted key variables such as the human development index (a proxy for economic development), broad money supply, deficit budget, domestic debt, and external debt as they investigated the relationship between deficit financing and economic development in Nigeria from 1980 to 2024. They employed cointegration and error correction analysis. Their findings indicated that all the variables are integrated of order 1(0). The application of an Error Correction Mechanism (ECM) further revealed a significant short-run relationship and quantified the rate of adjustment back to the long-run equilibrium. The study concludes that budget deficits, by negatively correlating with the HDI, can act as a constraint on government expenditure. Consequently, the authors recommended a comprehensive fiscal approach, emphasizing prudent management of domestic and external debt, to safeguard Nigeria’s economic well-being. However, it should be noted that if all variables are integrated to order zero, I(0), the problem the ECM is designed to solve simply does not exist. This is because the entire theoretical foundation of the ECM is built on the concept of cointegration, a long-run equilibrium relationship between variables that are non-stationary (I(1)) but move together over time. Hence, using ECM to model I(0) variables is inappropriate. MATERIAL AND METHODS The study adopts the ex post research design. This implies analyzing and understanding the consequences of a particular event after it has occurred. It is fitting that the study seeks to analyze the effect of fiscal deficit financing strategies on human development in Nigeria.

  generalfuture workevidence 5/5
  Keywords: development human deficit economic debt relationship fiscal nigeria keynesian error correction model long budget deficits
• Ongoing Debate Between Foreign Aid and Economic Growth in Nigeria: A Wavelet Analysis (2020) · Social Science Quarterly · cited 62× · doi

  Abstract This study aims to reexamine the interconnection between economic growth, foreign aid, trade, gross fixed capital formation, and inflation rate in one model for the case of Nigeria, which has not yet been analyzed utilizing the new econometric techniques, employing time series data covering the years between 1980 and 2018.

  generalabstractevidence 5/5
  Keywords: abstract aims reexamine interconnection economic growth foreign trade gross fixed capital formation inflation rate model
• Inflation, recession and the federal budget deficit (or, blaming economic problems on a statistical mirage) (1986) · Policy Sciences · doi

  The paper identifies a gap in the understanding of the relationship between budget deficits and economic problems. The study notes that the macroeconomic harmfulness of budget deficits has not been shown. The paper highlights the need for further research on the causal effects of deficits on inflation, GNP, and private investment.

  generalstated research gapevidence 5/5
  Keywords: paper identifies gap understanding relationship between budget deficits

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