Democracy and the Performance of the Nigerian Economy
Aminu Umaru, Gbenga Adeyemi, Bolaji Eunice Kehinde

Abstract
This paper investigates the impact of democratic dispensation on the performance of the Nigerian economy between 1983 and 2012. The paper divide the period into two (military and democracy i.e. 1983-1998 and 1999-2012).It’s employed descriptive statistic (comparative analysis of major indicators of economic performance in Nigeria through simple averages) and multiple regression analysis (OLS), causality as well as Johansen cointegration technique. The Johansen cointegration result shows that there was no cointegrating equation; implying the absence of long run relationship between economic growth and democracy in Nigeria. The results of causality are contained in table 4.0.2.2. The results revealed that there was no causation existed between GDP and poverty as well between GDP and democracy, one-way causation existed between corruption and GDP, but the causation runs from GDP to corruption which implied that corruption cannot cause GDP but GDP does cause corruption, one-way causation existed between democracy and poverty, but the causation runs from poverty to democracy and not the other way round, also that one-way causation existed between corruption and democracy, but the causation runs from corruption to democracy which implied that corruption cannot cause democracy but democracy does causes corruption. The causality result further revealed the existence of bi-directional causation between corruption and poverty which implied that corruption can cause poverty and poverty can also cause corruption. Most importantly corruption causes poverty more than poverty does cause corruption. The main concern of this study is to find out whether or not that democracy can cause growth in output in Nigeria. This paper revealed to us that there was no causation between GDP and democracy in Nigeria. The results of OLS indicated that unemployment, corruption and democracy were statistically significant while the coefficient of inflation, poverty, and the constant were found statistically insignificant. The result further revealed that change in unemployment rate, inflation rate, poverty level and corruption level raises output in the economy while change in democracy reduces output in the economy. The result of descriptive statistics revealed that on the average GDP is higher during democracy than during the military, unemployment rates, poverty level and corruption were found on the average be higher during democracy than during military , inflation rate on the average is higher during the military than during democracy. This paper adopted unemployment, poverty and corruption as the yardstick for measuring performance of the Nigerian economy. Based on the results of this study we recommend that military regime is the best for the Nigerian economy for now in terms of reduction in unemployment, poverty, corruption and income inequality. Democracy can be the best if and if the politicians take interest of the nation first in all ramifications before their personal interest.

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