Osemene, Olubunmi FlorenceFagbemi, Temitope OlamideKazeem, H. S.Akano, A. I.2020-05-222020-05-222015Osemene, O. F., Fagbemi, T.O., Kazeem, H. S. & Akano, A. I. (2015): An Assessment of the Effect of Capital and Recurrent Expenditure on Economic Growth in Nigeria. Ilorin Journal of Management Sciences, 2(1), 108 – 121. Published by Faculty of Management Sciences, University of Ilorin, Nigeria.2408-655Xhttp://hdl.handle.net/123456789/3995Government oftentimes uses expenditure to control the economy. The study assesses the effect of government expenditure on economic growth of Nigeria over a period of thirty two years, that is, 1981-2013. Total capital expenditure and total recurrent expenditure were used as proxy for government expenditure while economic growth was proxied by gross domestic product. The data used for analysis were obtained from the Central Bank of Nigeria (CBN) statistical bulletin. In order to observe the properties of time series data, diagnostic tests were carried out on the variables. The regression result showed that total capital expenditure is positive and significant in explaining and predicting the economic growth proxy by GDP, while total recurrent expenditure revealed a negative and a significant relationship with gross domestic product. Inflation which serves as a control variable showed a positive and significant relationship with gross domestic product. The study was able to conclude that total capital expenditure contributed positively to gross domestic product and that higher total recurrent expenditure decreases economic growth of Nigeria under the study period. The study recommended that the proportion of government total expenditure that goes into capital expenditure financing should be increased. Also, a high degree of accountability and transparency be maintained on government spending at various units of the economy to prevent channeling of public funds to private accounts of government officials.enPublic Expenditure,Government Funds,Private accountsNigeriaEconomic growth,Article