EFFECT OF RAPID POPULATION INCREASE ON ECONOMIC GROWTH OF NIGERIA

CHAPTER ONE.

INTRODUCTION

1.1 Background of the study

Nigeria, the most populous country in Africa, has undergone significant population growth over the past few decades. According to the Nigeria Bureau of Statistics (2021), the estimated population of Nigeria surpassed 200 million, with projections indicating continued growth in the coming years. This demographic phenomenon has profound implications for the countrys economic growth, shaping the dynamics of productivity, labour force, and resource allocation. One of the ways in which population growth impacts economic growth in Nigeria is through its effect on the labour force. With a growing population, there is an increase in the number of individuals entering the work force. According to Ochinyabo (2021), this can lead to a demographic dividend if the country invests in education, healthcare, and skill development to enable these individuals to contribute productively to the economy. Yahaya et al. (2020) purported that the availability of a large labour force boosts production and economic output, fostering economic growth. However, the realization of the demographic dividend relies on several crucial factors. For one, there must be sufficient employment opportunities and job creation to accommodate the expanding labour force. According to Malthus (1986), if the pace of economic growth does not match the rate of population increase, unemployment and underemployment can rise, leading to social and economic challenges given that population grows in geometric terms while the resources required to cater for the population grows arithmetically. Malthus and Winch (1992) explicitly explained that the inability of the resources available to cater for the population will eventually metamorphose into social unrest, poverty, war and a decline in a nation’s overall wealth.

The study of Yakubu et al. (2020) shows that the speedy rise in population size in developing countries is because of high birthrate and an unchecked desire to control the rate of procreation given the subsequent satisfaction that comes with surplus resources. It has played out in the present-day Nigeria as the country’s youth unemployment rate stood at approximately 42% (NBS, 2021), highlighting the importance of addressing this issue to leverage the potential benefits of population growth.

The existing debate has been between if population growth negatively affects economic growth as purported by the Malthusian theory or if population growth can actually be beneficial and promote economic growth if maximized ,as stated by the anti-Malthusian theory by Julian Simon (2014). Scholars like Simon (2014) & Sabin (2013) have put forward that population growth could be taken advantage of and transformed into an extreme productive labour force that could drive economic growth. However, research has shown that this can only be possible if the country possesses an effective educational system which equips its working population with the required skills to drive research and development. However ,Ibrahim et al. (2020) explained that most developed economy plagued with high rate of population growth, lack the institutions and facilities required to harness the benefits of a large population. According to Rahman et al. (2020),population growth can significantly impact domestic consumption patterns because, with a larger population comes increased demand for goods and services, which can stimulate economic activities . However, to ensure sustainable consumption patterns and avoid resource depletion, proper planning and policies are necessary to balance consumption with available resources and environmental considerations (Ideh et al., 2022).Despite the potential advantages, rapid population growth can also strain resources and infrastructure, posing challenges to economic development (Ideh et al., 2022).

The demand for essential services such as healthcare, education, and housing may outstrip the government's capacity to provide adequate facilities and services, leading to disparities in access and quality of life. Insufficient investment in infrastructure can hinder productivity and the country's competitiveness in the global market (Rehman et al., 2022).Furthermore, if economic growth does not keep pace with population growth, it can exacerbate poverty levels (Adewole,2012). As of 2021, Nigeria's poverty rate was estimated to be around 40% (NBS, 2021), with a significant proportion of the population living below the poverty line. High poverty rates and unequal income distribution can hinder inclusive economic growth and lead to social unrest, undermining stability and development efforts.The impact of rapid population growth on economic growth intertwines with other factors like educational attainment and healthcare. Investment in education and healthcare is crucial for developing human capital, which plays vital role in increasing productivity, fostering innovation, and driving technological advancements. In 2021, Nigeria's literacy rate for adults aged 15 and above was approximately 62% (NBS, 2021), highlighting the need for further efforts to improve access to quality education.

Addressing the challenges and harnessing the potential benefits of population growth has shown to be an endeavour for developing economies and brings about more concern than the challenges presented by rapid population growth (Schneider, 2022). The existing debate is that either rapid population growth is beneficial or parasitic to economic growth as seen in several insights into the subject matter and lies at the root of the rationale behind this study. Ogunjinmi (2022) has proposed that by addressing issues related to education, healthcare, employment, and infrastructure, Nigeria can maximize the potential benefits of its growing population and foster a more inclusive, resilient, and prosperous economy. A holistic and forward-thinking approach to population and economic development will be crucial in shaping Nigeria's future growth trajectory and achieving sustainable development goals.

1.2 Statement of the Problem

The burgeoning population in Nigeria has been growing at an accelerated pace in recent years (Tartiyus et al., 2015), raising significant concerns about its potential implications for the country's economic growth and overall development. The problem at hand revolves round comprehending the challenges posed by rapid population growth and gaining deeper insights into how it influences Nigeria's economic growth trajectory. With the surge in population comes array of challenges that need attention. Firstly, the strain on the nation's infrastructure and resources has intensified (Ogunleye et al., 2018) as the existing systems grapple to cope with the escalating demands of a larger population. Consequently, issues like inadequate transportation, limited access to utilities, and stretched public services have emerged. Secondly, the expansion of the labor force has contributed to heightened unemployment rates, creating a productivity gap and potential social instability (Akinbode et al., 2017). Moreover, the rapid population growth has further exacerbated income inequality, as limited access to opportunities impedes upward mobility for the population. Furthermore, the surge in population has escalated food demand (Adewole, 2012), making it increasingly difficult to attain food security due to production constraints and distribution inefficiencies.

Nevertheless, demographic trends can also bring about opportunities for economic growth. A growing population translates into an expanding domestic consumer market, which holds the potential to stimulate demand for goods and services, thus driving economic growth (Yahaya et al., 2020). Additionally, a youthful and dynamic workforce resulting from population growth presents opportunities for increased productivity and innovation (Akinbode et al., 2017). However, seizing these opportunities requires a substantial investment in human capital, including education and healthcare, to fully harness the population’s potentials.

The study delves into the intricate dynamics between rapid population growth and its impact on Nigeria's economic growth. By identifying the challenges and opportunities arising from this phenomenon, policymakers and stakeholders can devise targeted strategies to leverage demographic trends for sustainable and inclusive economic development. Addressing the impact of rapid population growth on economic growth is crucial for securing Nigeria's long-term prosperity and socio-economic well-being.

1.3 Research Questions

What is the impact of rapid population growth on economic growth in Nigeria?
What is the causal relationship between population growth and economic growth in Nigeria?

1.4 Objectives of the study

To determine the impact of rapid population growth on economic growth in Nigeria.
To determine whether there exists a causal relationship between population growth and economic growth in Nigeria.

1.5 Research Hypothesis

H₀₁: Population growth has no significant impact on economic growth in Nigeria.

H₁₁: Population growth has a significant impact on economic growth in Nigeria.

H₀₂: There exists no causal relationship between population growth and economic growth in Nigeria.

H₁₂: There exists a causal relationship between population growth and economic growth in Nigeria.

1.6 Significance of the study

This study holds great significance for various reasons. It will provide valuable insights to policymakers, economists, and stakeholders, aiding in evidence-based policy formulation and planning. Understanding the implications of population growth on economic development is crucial for achieving Sustainable Development Goals, attracting investments, and allocating resources effectively. The study's findings will contribute to poverty alleviation strategies, guide infrastructure development, and promote human capital development through education and healthcare initiatives. As Nigeria undergoes a demographic transition, this research will help manage population dynamics and regional disparities, fostering equitable growth across nations. Therefore, exploring the relationship between population growth and economic growth in Nigeria will offer crucial knowledge to promote sustainable development, uplift living standards, and work towards long-term growth.

1.7 Scope of the Study

This study focuses on Population growth and Economic growth in Nigeria for the period of 1980 to 2018, using the following variables; Real Gross Domestic Product (as the dependent variable) and Unemployment Rate (UR), Population growth (POP) & Labour Force Participation Rate (LFPR) which are the independent variables. Secondary data will be used to in testing the variables.

1.8 Organization of the Study

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