Fiscal Federalism and Regional Inequality: A Political Economy Analysis of Northwestern Nigeria's Development Challenges

This study investigates how Nigeria’s system of fiscal federalism contributes to ongoing regional inequality with specific reference to the Northwestern area. While fiscal federalism is meant to promote balanced development by allowing sub-national units access to financial resources, the Nigerian approach has often increased gaps due to centralized management, politicized income allocation and inadequate institutional procedures. Drawing on a range of secondary sources such as government papers, academic literature and development data, this study explores the patterns of federal allocations and the political economic variables that drive them. It finds that despite being rich in natural and human resources, Northwestern Nigeria suffers from persistent underdevelopment, in part because of how federal finances are negotiated and dispersed. The study argues that tackling these difficulties requires not only policy reform but also a shift in how power and fiscal authority are organised in Nigeria’s federal setup.