Electricity Crisis and Manufacturing Productivity in Nigeria (1980-2008)

Abstract

Many researchers and policy makers have often emphasized the importance of adequate and regular electricity supply towards increasing manufacturing productivity in Nigeria. In line with this, this study was carried out to evaluate the impact of electricity crisis on the manufacturing productivity growth in Nigeria.The variables in the model include, manufacturing productivity index (as dependent variable) while electricity generation, capacity utilization rate, government capital expenditure on infrastructures and exchange rate (represent the independent variables). The study employed the ordinary least square multiple regression to analyze the time series data between 1980 and 2008. The result of the study shows that electricity generation and supply in Nigeria under the reviewed period impacted negatively on the manufacturing productivity growth, due to unnecessary government’s spending on non-economic and unproductive sectors.In view of the findings,  the study suggest among others, a reverse of the ugly trend of poor electricity supply through the initiative of independent power project, as proposed by some states in Nigeria.

Keywords: Electricity Crisis, Manufacturing, Productivity, Nigeria, 1980-2008.