Page Length: 43

Size: 44 KB

Format: PDF & Word



Cover Page                                                                             i

Title Page                                                                                ii

Declaration                                                                             iii

Certification                                                                                     iv

Approval page                                                                        v

Dedication                                                                              vi

Acknowledgements                                                                          vii

Table of Contents                                                                viii-ix

Abstract                                                                                  x




INTRODUCTION                                                                           1

1.1     Background of the Study                                                1

1.2     Statement of the Problem                                                3

1.3     Research Questions                                                                  4

1.4     Purpose of the Study                                                                5

1.5     Significance of the Study                                                5

1.6     Scope of the Study                                                          6

1.7     Limitations of the Study                                                 6

1.8     Definition of Terms                                                                  7

1.9     Organizations of the Study                                                       9



Literature Review and Theoretical Framework

2.1     Literature Review                                                           10

2.2     Theoretical Framework                                                   16





Research Design and Methodology

3.1     Research Design                                                             21

3.2     Area of the Study                                                           21

3.3     Population of the Study                                                  22

3.4     Sample and Sampling Techniques                                            22

3.5     Method of Data Collection                                                       23

3.6     Instruments for Data Collection                                      24

3.7     Reliability of the Instrument                                                     24

3.8     Validity of the Instrument                                                         25

3.9     Distribution and Retrieval of Instruments                                  26

3.10   Method of Data Analysis                                                26



Data Presentation and Analysis

4.1     Data Presentation                                                           27

4.2     Analysis of Research Question                                        30

4.3     Interpretation of Result                                                   35




5.1     Summary of findings                                                                37

5.2     Conclusion                                                                     37

5.3     Recommendation                                                           38

References                                                                     41

Appendix A                                                                            44

Appendix B                                                                   45




This study focus on Revenue allocation formulation and National Development in Nigeria. Specifically, the study looks at how the various revenue allocations to the three tiers of government affects real gross domestic product (RGDP) in Nigeria using time series data period 1993 to 2012. The population size of 400 was used which received to a sample size of 200 using yaro yameni sampling technique. Simple percentage method was used in the analysis and interpretation of data. The study’s findings show that revenue allocations have significant causal relationship with economic development in Nigeria, with only revenue allocation to states having significant negative relationship. Unidirectional causality runs from revenue allocations to real GDP in Nigeria. All variables of the study are cointegrated and have a long-run relationship that 87.62% of the short-run disequilibrium is corrected yearly. The study recommends among others that more financial control and value for money audit should be carried out to minimize wastages and corruption in the states of the federation, so as to change the direction of influence of states’ revenue allocation on economic development.






Every government pursues economic development by trying to achieve macroeconomic objectives in a particular system of government. Various systems of government include federation, unitary, and confederation. The Nigeria’s system favors federation. The federation of Nigeria achieves her macroeconomic objectives by performing the functions of resource allocation, income distribution/redistribution, and economic stabilization within the central government, that is, federal government and its units (states and local governments). This system of performing government functions in different tiers of government is called fiscal federalism (Buhari, 2001; Likita, 1999).

Fiscal federalism is a system of taxation and public expenditure in which revenue-raising powers and control over expenditure are vested in various levels of government within a nation, ranging from the national government to the smallest unit of local government (Anyafo, 1996). Basically, fiscal federalism emphasizes on how revenues are raised and allocated to different levels of government for development. A large body of literature exists on Nigeria’s fiscal federalism particularly with reference to revenue allocation. Despite the profound and lengthy discussions that have taken place on the subject for about four and half decades, consensus has not been reached concerning the optimal formula to adopt to achieve desired economic development (Aboyade, 1985; Buhari, 2001). Thus, the issue of revenue allocation has been a recurring theme in Nigeria’s fiscal federalism.

There is the problem of how to allocate revenue to different tiers of government in relation to the constitutionally assigned functions. The discordance between fiscal capacity of various levels of government and their expenditure responsibilities, the noncorrespondence problem, is a striking feature of the Nigerian federal finance (Mbanefoh & Egwaikhide, 2000). There is also the problem of how revenue should be shared among the states and local councils. Several studies mainly exploratory (such as Aluko, 2000; Ekpo, 2004; Khemani, 2001; Mbanefoh & Egwaikhide,

2000; Suberu, 2006; Uche & Uche, 2004) were carried out on how revenue is shared within the federal government, state governments, and local governments and the basis of sharing the revenue to these federating components. But these studies could not empirically study the impact of the revenue allocation on  development of Nigeria. Other studies, such as Aigbokhan (1999), Jimoh (2003), Emengini and Anere (2010), Akeem (2011), and Usman (2011) carried out empirical studies on the effects of the level of decentralization of government activities including revenue allocation on Nigeria’s economic development using

econometric analysis. None of these studies to the best of my literature review utilized causality econometric test to ascertain the direction of causal relationship between the variables. However, this study intends to examine empirically how different revenue allocations over the years impacted on economic development of Nigeria and the causal relationship between the variables.



The issue at back of government mind while establishing the pension scheme is to provide the employee with a means of securing on retirement a standard of living reasonably consistent with that which years later, we can see that reverse has been the case, the worker decides to create retirement, just like death in developed countries the worker looks forward to retirement.

The management of pension scheme has made things so hard for the worker that a retiree has to travel long distance to get his pension paid in Nation development in Nigeria has been observed that those who are retired.

This is why this research is intended to suggest solution to the problem of mismanagement of allocation formular and National development in Nigeria a study of Orlu local government Area Imo State.



  1. What are the effects of revenue allocation formular on National Development?
  2. What are the challenges of revenue allocation formular in Nigeria?
  3. What are the solutions for positive change?






          The purpose of the study is;

  1. To examine the effects of revenue allocation formular on national development.
  2. To investigate the challenges of revenue allocation formular on national development.
  3. To provide/proffer solutions for positive change.



This study is carried out basically to look into the problems of revenue allocation to local government with particular reference to Orlu local government Area Imo State. Also it will be directed to or focused on the unrealistic transfer of funds to the account of the local government by the state government.

It will create awareness with the problems encountered by revenue allocation to the local government. And it will also fund the possible solution to the problems.

This study after been completed will be very advantageous to local governments to know how the allocation of revenue is been distributed by the federal govern governments.



This study seeks to undertake on revenue allocation formular and national development in Nigeria. But study is to covers federal polytechnic nekedde as a case study, which is one of the many institutions in Nigeria.

However, the necessary reference would be made to other institutions and comparism to assess the performance of this level base on allocation output.


1.7     Limitations of the Study

In the course of writing and carrying out this project work, the research encountered many difficulties; some errors in the results of the research and from external sources of data collection. These are factors  standing as constraints thereby limiting the effect of the research result.

Among these are, time finance , scope and use of wrong statistics in data analysis, due to time limit, the research work is a time consuming one. A lot of time is taken to observe the subjects.

Most  times the behaviour of the staff changes even when they are aware that they are being observed by the researcher, this is by taking their behavior. The researcher also observed that these senior staff some time give true and false information in order to cover their branches.

At sometime the research work lasted over two months due to large scope of area of the study.



Terms are words with specific meanings. The terms to be used for this study as the topic suggest are problems, revenue, allocation, local government, policy, administration, administer, subvention, overview, and encounter.

  1. PROBLEMS: Simply means question or solutions involving difficulties.
  2. REVENUE:Ganiya O. G. (1998) this refers to the money that a government receives form taxes or that an organization receives form it business. It also refers to the amount of money collected by the government form their usually regular sources of revenue.
  3. ALLOCATION:Simply means to distribute share out or to give each his share.
  4. POLICY:Is the plan of action agreed or chosen by a political party, or a company.
  5. ADMINISTRATION:Simply means the activities that are done in order to plan, or organize and run a business, school or other institution.
  6. ADMINSTER:Simply means to manage and organize the affairs of a company, an organization or a country.
  7. SUBVENTION:Refers to the amount of money that is given by a government to help an organization.
  8. NATIONAL DEVELOPMENT: This is the expansion and growth of people in an area of government.
  9. ECONOMY: The relationship between production trade and supply of money in a particular country or region.


This research work is organized in five chapters, for easy understanding, as follows. Chapter one is concern with the introduction, which consist of the (background of the study), statement of the problem, purpose of the study, research questions, significance of the study, scope of the study etc. Chapter two being the review of the related literature presents the theoretical framework, conceptual framework and other areas concerning the subject matter.     Chapter three is a research methodology covers deals on the research design and methods adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding.  Chapter five gives summary, conclusion, and recommendations made of the stud


DISCLAIMER: All project works, files and documents posted on this website, are the property/copyright of their respective owners. They are for research reference/guidance purposes only and some of the works may be crowd-sourced. Please don’t submit someone’s work as your own to avoid plagiarism and its consequences. Use it as a reference/citation/guidance purpose only and not copy the work word for word (verbatim). The paper should be used as a guide or framework for your own paper. The contents of this paper should be able to help you in generating new ideas and thoughts for your own study. is a repository of research works where works are uploaded for research guidance. Our aim of providing this work is to help you eradicate the stress of going from one school library to another in search of research materials. This is a legal service because all tertiary institutions permit their students to read previous works, projects, books, articles, journals or papers while developing their own works. This is where the need for literature review comes in. “What a good artist understands is that nothing comes from nowhere. The paid subscription on is a means by which the website is maintained to support Open Education. If you see your work posted here by any means, and you want it to be removed/credited, please contact us with the web address link to the work. We will reply to and honour every request. Please notice it may take up to 24 – 48 hours to process your request.

WeCreativez WhatsApp Support
Administrator (Online)
Hello and welcome. I am online and ready to help you via WhatsApp chat. Let me know if you need my assistance.