Modeling the relationship between infrastructure, urbanization, and poverty dynamics in Nigeria

Abstract

The present study utilised annual time series data from the Central Bank of Nigeria (CBN), the Statistical Bulletin, the World Bank, and the Debt Management Office (DMO) to investigate the impact of urbanisation and infrastructure on poverty in Nigeria. The data covered the period from 1990 to 2022. Urbanisation was represented by the Urban Population Growth (UPG) rate, whereas infrastructure was denoted by the number of cemented roads (PRD), electric power supply (EPS), and telecommunication infrastructure (TCI). The poverty headcount served as the dependent variable. The series underwent integration at orders zero (1) and one (1), as determined by an Augmented Dickey Fuller stationarity test on the variables. Indicating the existence of a long-run cointegration relationship, the Autoregressive method was utilised to verify the hypothesis; the bound cointegration was computed to ascertain the relationship's significance. In contrast, the provision of telecommunication infrastructure in Nigeria is the primary cause of poverty, as indicated by the study, which found that urbanisation hindered economic development in the short term by making a positive impact on poverty. In light of the study's findings, it is recommended that the government, private sectors, investors, corporate bodies, and stakeholders make concerted efforts to enhance the quality of road infrastructure, telecommunication facilities, and electric power supply in order to reduce the poverty rate in Nigeria, as the current level of infrastructure development in the country fails to meet the country's economic development objectives.