1.1 Background to the Study
Poverty has been identified in literature as part and parcels of mankind and its existence has abhorred by individuals, families, nations of the economy (Gangas, 2017). As such, poverty is often described as the enemy of mankind and it is thought to be the gross violation of our civilization (Kazi and Leonard, 2012). The history of mankind demonstrates that poverty is nothing but a curse, not only for the individual who is poor, but for remainder of the community, nation and global society at large. It compels people to think that famine, misery and deprivation are natural course of life; and that the poor people are not entitled for living better lives. Poverty alongside unemployment; an identical bane is a global trend which affects people in various depths and levels at different times and phases of existence (Noko, 2016).
Poverty is the world’s current greatest threat to peace and stability more than terrorism and other highly publicized struggles. According to Sachs (2009), more than eight million people around the world die each year because they are too poor to stay alive. In the year 2010, the United Nation Development Project (UNDP) estimated roughly 1.4 billion people were living in extreme poverty of these, about 93% live is three regions; East Asia, South Asia and Sub-Saharan Africa (World Bank, 2016). In Nigeria, despite the government’s poverty eradications campaigns, national development plans and sessional papers, poverty is still a major challenge (Akpawu & Abua, 2016). It is also recognised by all and sundry as a major threat to the very existence of Nigeria as a country. It may not be easy to have a universal definition to poverty as it is viewed from different angles by researchers.
However, according to Sachs (2009), poverty can be defined in terms of three distinguishable degrees. These are: Extreme poverty, moderate poverty and relative poverty. Extreme poverty means the household cannot meet basic needs for survival. Such people are perpetually hungry, unable to access health care; they lack amenities of safe drinking water and sanitation. They cannot afford education for their children and cannot shelter their families. According to Kahsu & Nagaraja (2017), moderate poverty on the other hand generally refers to conditions of life in which basic needs are met, but just barely. They further argued that, relative poverty is construed as a household income level below a given proportion of average national income. In high income, countries they lack access to cultural goods, entertainment, recreation, quality health care, education and other prerequisites for upward social mobility.
The World Bank has been defining poverty in statistical terms of income of one US dollar per person per day, measured at purchasing power parity to determine the number of extreme poor around the world. Cursory observations show that many Nigerians are living below the poverty level of one US dollar per day. The base line is that, many Nigerians live in poverty in its extreme nature manifesting itself in terms of lack of basic standard of health, nutrition, shelter, water and sanitations, and other minimum need for survival, well-being and participation in the society (World Bank, 2016). In Nigeria, poverty sometimes, presents itself in a periodical manner. Poverty may be seasonal in rural areas; lean periods and low income availability coincide with period of endemic disease. Seasonal rains destroy rural roads and physically isolate the rural poor from markets and essential services. Among the urban poor, times of economic hardship fall at the middle of the month when salaried employees run out of funds. Poverty can sometimes be structural (Noko, 2016). It systematically excludes a portion of the population from full national and social participation through hunger, inadequate income, powerlessness, poor education and disease. For example, if a parent is poor, the chances of the children becoming non poor are limited. The parent who is poor have no landed property, lacks money to educate the children and usually has a large family that is inadequately (Ozturk, 2011).
Poverty makes it difficult to make investments in education and health that would increase a person‘s productivity. This is not only true for individuals; families equally face an inter-generational poverty trap. Families face the choice between sending their children and young family members to school and sending them to earn much-needed income. Education provides a foundation for eradicating poverty and fostering economic development. It is the groundwork on which much of economic and social well-being of the citizens is built. Education is the key to increasing economic efficiency and social consistency, by increasing the value and efficiency of the labour force and consequently raises the poor from poverty. Education increases the overall productivity and intellectual flexibility of the labour force and ensures that a country is competitive in world market now characterized by changing technologies and production methods (Ozturk, 2011).
According to Roberts (2011), the primary determinants of a country’s standard of living is how well it succeeds in developing and utilizing the skills and knowledge, and furthering the health and educating the majority of its population. No country has achieved constant economic development without considerable investment in education and human capital (Ozturk, 2011) many researchers have shown handsome returns to various forms of human capital accumulation basic education, research, training and aptitude building (Denison, 2008, Bowman 2010). Unequal education tends to have a negative impact on per capita income and thereby increase poverty in many countries.
Educating girls and women is probably the single most effective investment a developing country like Nigeria can make, whether or not women work outside the home. It creates a multitude of positive remunerations for families including better family health and nutrition, improved birth spacing lower infant and child mortality, and enhanced educational attainment of children. In order for a country to be adequately integrated in worlds market for manufactured goods, and compete in these markets and in globalizing service markets will depend on the excellence of human capital they bring to the competition. Ensuring that all citizens are educated and numerate, that many possess a wide range of problem solving skills beyond the basic level, and that some have world class professional skill will be an advantage (Akpawu & Abua, 2016).
1.2 Statement of the Problem
The issue of Poverty has continued to be a core subject matter in Nigeria and other African countries alike. Human poverty is more than income poverty since it is the denial of choices and opportunities for living tolerable life (United Nations, 2007). Poverty amid plenty is a challenge and has been on the increase for a long time now. From economic theory, theory, population increase should be able to attract increased economic growth and consequently increased standard of living which is one of the measures of development.
In Nigeria, this situation is contradictory given the large resources (human and physical) that the country is endowed with. The country has increasing rate of poverty both at the regions and at the national level, as demonstrated by high unemployment rate, high income inequality, low quality human capital, high percentage of population on welfare and high out migration in the face of high economic growth measured by GDP (Akpawu & Abua, 2016). Information from the National Bureau of Statistics (2012) and UNDP (2009) showed that about 15% of Nigeria’s population was poor in 1960. Poverty rates in Nigeria increased from 27.2 percent in 1980 to 42.7 percent in 2004 and further to 65.6 percent in 2010. According to World Bank (2011) of the World Bank, Human Development Index (HDI) in 2011 puts Nigeria at 156th position among 177 countries as compared to the 151st position in 2002, Nigeria’s human poverty index (HPI) for 2009 was only 36.2% placing Nigeria at the 114th position and among the 7th poorest nations in the world while the ratio of the richest 10 percent to the poorest 10 percent was 16.3 with GINI index from 42.9 in 2004 to 44.7 in 2010 (National Bureau of Statistics, 2012; UNDP, 2013).
Thus, Following Noko (2016) this research argued that, people living in poverty are unable to meet their basic needs, such as essential nourishment, basic health, and education. An expansion in earnings leads to a better nutrition plan, improved health, and better education. At the beginning of the twenty first century, over 1.2 billion people are living in extreme poverty, subsisting on less than 1$ a day. This proportion has fallen from 32 percent in 1987 to 22 percent in 2008 (World Bank, 2016). Education and poverty are inversely related. The higher the level of education of the population, lesser will be the number of poor persons because education imparts knowledge and skills which is helpful in higher wages. The direct effect of education on poverty reduction is through increasing the earnings/income or wages. The indirect effect of education on poverty is important with respect to ‘human poverty’ because as education improves the income, the achievement of basic necessities becomes easier and raises the living standard which surely means the fall in human poverty. The education indirectly helps in the fulfillment of basic needs like water and sanitation, utilization of health facilities, shelter, and it also affects the women’s behavior in fertility decisions and family planning (Awan et al., 2011).
1.3 Research Questions
In the course of this work, the following questions will provide a lead for the research work.
1. Is there any significant causal relationship between poverty and education development in Nigeria?
2. Is there long run relationship between education development and poverty in Nigeria?
3. Is there any significant impact of education development policies on poverty reduction in Nigeria?
1.4 Objectives of the Study
The fundamental aim of this research work is to construct an empirical relationship between poverty and education development. However, the following specific objectives will be achieved.
The specific objectives of the study therefore include the following
1. To establish the direction of causality existing between poverty and education development.
2. To determine the nature of long-run relationship between poverty and education development.
3. To determine the impact of education development on poverty in Nigeria.
1.5 Statement of Research Hypothesis
The following null hypotheses were tested in the course of the research work:
1. H0: There is no significant causal relationship between poverty and education development in Nigeria
2. H0: There exist no long-run equilibrium relationship between poverty and education development in Nigeria
3. H0: Education development does not have significant impact on poverty in Nigeria.
1.6 Significance of the Study
In Nigeria poverty and education development are really assuming an inverse relationship, such that the growth of one leads to the decline of the other. Therefore, this study will be relevant since it will provide an insight into the relevant literature and will help to lay bare the causes and effects of poverty in Nigeria and how education education can be used as instrument to curb the poverty in the country. It will equally be of help to the general populace to appreciate the fact that poverty scourge that need to be faced in order to achieve economic growth and development and that through the findings and subsequent recommendations of this study, poverty will be reduced or eradicated. Finally, it will be of immense importance to future researchers since it will serve as a spring board for further research.
1.7 Scope and Limitations of the Study
The researcher’s work focuses on the relationship between poverty and education development with special emphasis on the impact of education development on poverty reduction in Nigeria. For empirical analysis, this study is limited to the period between 1980 and 2016.
As it relates to the limitations encountered, the study of this nature cannot be completed without the researcher experiencing some constrains. The first major limitation of the study experienced by researcher was lack of time. This is due to the fact that both academic course work and the study were taking place simultaneously. Another limitation encountered by the researcher was the lack of sufficient data particularly on poverty which greatly affected the study in terms of carrying out a direct and detailed econometric analysis on the variables. Finally for an in-depth work to be carried out in this study, the sourcing of data was not easy.