Abstract

Mike A. Onodje

The paper extends empirical studies on the effects of fiscal policy shocks on private consumption to the Nigerian situation. It examines whether government expenditure shocks and tax revenue shocks have Keynesian effects. Data spanning the period 1980 to 2004 were used to estimate a Vector Error Correction Model. The estimation results show that both government consumption and tax revenue shocks have Keynesian effects; thereby validating the position of the empirical literature.