A tale of two giants: oil and economic development in Nigeria and Indonesia (1960-1999)

This study compares the development trajectories of Indonesia and Nigeria in the period 1966-1999, and identifies the key factors that drove rapid socio-economic development and economic stagnation observed in both countries respectively. An assessment is made of the extent to which political instability and economic policies adopted by governments in these two countries accounted for turning points observed in their socio-economic fortunes. The main question that guided the research is "What other factors, apart from economic policies and political instability are relevant in explaining the divergent development outcomes observed between Nigeria and Indonesia in the last four decades?" The study goes beyond the three already identified pre-conditions for economic growth and development (macro-economic stability, economic freedom and pro-poor/rural spending), by examining the possible impact of other variables, key among which are population control and foreign aid and investment that had been evoked in one way or the other by other researchers but often in a very limited way. The study explores the potential impact of the latter three factors, using the Indonesian experience as a case study, checking what went wrong in Nigeria's economic development planning and whether the Indonesian model of economic growth and development can be replicated in Nigeria, and under what specific conditions