Research purpose: The study examined the effect of foreign direct investment inflows, foreign direct investment outflows and remittance inflows on total government capital expenditure in Nigeria.
Methodology: The study adopted an ex-post-facto research design, covering a period of 54 years (1970 – 2023). Data collated from World Bank Database and CBN Statistical Bulletin were diagnosed and analysed using Auto regressive distributed lag (ARDL), ARDL cointegration models, and so on.
Findings: The results showed that all explanatory variables have non significant effects (individually) on total government capital expenditure at 5% level of significance both in the long and short runs. While foreign direct investment outflows (coeff. = -0.601, std. error = 2.034, t-stat = -0.295 and p-value = 0.769), exerted negative influence on the regressand, both foreign direct investment inflows (coeff. = 0.127, std. error = 0.880, t-stat = 0.144 and p-value = 0.886), and remittance inflows (coeff. =-0.308, std. error = 0.674, t-stat = 0.458 and p-value = 0.650), exerted positive influences on the same dependent variable, indicating that the short run coefficient on error correction term is CointEq (-1) = -0.302 and very statistically significant at the same 5% (p-value = 0.020.
Conclusion: It connotes a long run relationship among entered variables in the economy, i.e. the short run change from the long run equilibrium is corrected by 30.2% each year. The positive association between foreign direct investment inflows, remittance inflows and government capital expenditure imply enhancing the operating environment and channels that facilitate significant increases in these predictors.