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INFRASTRUCTURE CAPACITY UTILIZATION ON MANUFACTURING GROWTH IN NIGERIA
CHAPTER ONE
INTRODUCTION
The purpose of this study is to
analyze how public infrastructure and capacity utilization could aid
manufacturing growth in a developing economy like Nigeria. The concern is
understandable where productivity growth is major determinant of the future of
standard of living.
Economist have written extensively
on the decline of productivity growth and how it affects output growth and has
gone to great length to try identify the reason for the show down.
BACKGROUND
OF THE STUDY
Prior to the early 1970 many
Nigerians did not realize the importance of public infrastructure and capacity
utilization as a major key to economic growth and development towards a better
standard of living hence, it was perceived that public policies to promote
economic growth and development international competitiveness were
traditionally focused on savings and private investment in plant and equipment
to the detriment of public infrastructure has not actually led us to the
promise land and this led to a high rate of rural urban drift or migration.
Over the years, this has led to the
increase in government policy to invest more in public infrastructure as a way
of fostering economic growth and development while not equally ignoring the
importance capacity utilization in the quest for economic growth.
STATEMENT OF
THE PROBLEM
Economists
and other close observers have tried to identify the factors responsible for
the falling productivity. Notably among the factors are poor and inconsistent
public policy, high unemployment and under employment, high and persistent
inflation, political instability and increasing military expenditure and the
deteriorating state of public infrastructure. Certainly all these factors to
varying degrees influence the rate of manufacturing growth. Prior to the 1970s,
government has been making efforts to sustain improvement in the lives of its
citizens, which undoubtedly depends on the growth of the economy. Improvements
of the citizenry depend on sustainable increase in the per capita out put. By
this measure Nigeria has not done fairly well due to the drop in oil price of
the early 1980’s
Attention should be given to the
serious deterioration of the nation public infrastructure, which raises the
question as to whether public capital significant affects economic development?
Policy makers and researchers concerned with economic issues have claimed for
years that public infrastructure; investment is one of the primary means to
implement a strategy of economic growth and development, infact one of the ways
local government encourages local industries is through investing in various types
of infrastructure.
The quest for industrialization
cannot be over emphasized, as can be understood from the study of development
economics, that industrialization promotes growth and in the long run
development for this reason developing economy is conscious of her industrial
growth.
Capacity utilization is an
essential thing in any developing economy because it helps in ensuring that
resources are allocated effectively and efficiently in the establishment of
public infrastructure that would be helpful in promoting the manufacturing
growth in the economy.
Thus, the question which thesis or
study, seek to address or the statement of problem is that; due to investment
in public infrastructure and capacity utilization improved output growth in the
manufacturing sector?
Has public infrastructure
investment using investment in capacity utilization as it relates to output had
positive impact on the citizenry; Does investment in public infrastructure and
capacity utilization.
In the short run enhance output
stabilization or achieve the run the desired macro economic goals in the long
run.
These are indeed statement or
problem that needs to be addressed in this study.
OBJECTIVES
AND RATIONALE OF THE STUDY
This research is aimed at stability
the relationship that exists between public infrastructure, capacity
utilization and manufacturing growth in Nigeria.
The objectives are as follows:
Examining
government role in the provision of public infrastructure.
Identifying
limiting factors to capacity utilization.
Appraise the
importance of both public and private sector investment and output growth.
To measure
the effectiveness and impact on output.
SIGNIFICANT OF
THE STUDY
the importance of achieving
significant results in providing public infrastructure using the required
capacity utilization could often hinge on the fact of what is done, how it is
done, when it is done and whom it is targeted at.
The study is expected to be a
concerted effort to identity articulate and highlight the existence, causes and
effects of public infrastructure, capacity utilization and output growth in
Nigeria. It is also the quest for streamlining its effect and making them more
potent.
It is believed that the research
would be beneficial to policy makers and arouse the interest of students to
conduct more research in the field of study.
HYPOTHESIS
The study is based on the
hypothesis that:
Ho: public
infrastructure and capacity utilization have succeeded in improving the
manufacturing sectors output.
HI: public
infrastructure and capacity utilization have not succeeded in improving the
manufacturing sectors output.
METHODOLOGY
These issues to be raised in this
are both theoretical and empirical. A sample regression model will be specified
and tested, using a simple regression analysis model.
On the theoretical side, effort
would be directed towards a review of the development on public infrastructure
and capacity utilization and productivity growth which will provide the
necessary foundation for simple empirical model.
SCOPE OF THE
STUDY
The period of focus of this study
will the period 1973 that the post civil war in Nigeria till the year 200, it
is pertinent to note the period also include Pre-sab, Sap and Post sap era in
Nigeria? More so, the study shall focus primarily on the impact of public
infrastructure, capacity utilization for productivity growth in Nigeria.
ORGANIZATION
ON THE STUDY
To achieve the stated objectives,
the chapters are divided into five as follows: chapter one deal with
introduction, chapter two devoted to literature review, chapter three is the
researches examining the theoretical framework and model specification, while
chapter four is presented and interpretation of regression result; and chapter
five deals with summary, recommendation and conclusion.
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