In Nigeria, the past decade has been characterized by conflict, insecurity, banditry and kidnapping, which have led to significant losses of lives, property, agricultural output, foreign direct investment and economic stability; the losses to GDP are estimated at tens of billions of dollars and outright displacement of millions of Nigerians. This research appraises the effect of conflict on the economic development of Nigeria by studying the relationship between Gross Domestic Product (GDP) and three proxies for conflict and insecurity such as Global Peace Index (GPI), Corruption Perception Index (CPI) and Annual Defence and Security Allocation (ADSA) covering the period of 2015-2026 in Nigeria. The analysis using time series regression model (ARDL) on log-transformed variables shows that there is a strong, positive and statistically significant relationship between ADSA and GDP, and a positive but statistically insignificant relationship between GPI and GDP, whereas the coefficient of CPI is negative but statistically insignificant. The overall level of significance of the model is high, and it accounts for about 90 per cent of the variation in GDP. The results suggest that the influence of defence and security budget on economic performance is related and the relations between the peace levels and perceived corruption are more complex in nature. The study highlights the importance of security investments that can be focused on specific areas, and an overall institutional overhaul, to reduce the economic costs of conflict and promote sustainable economic growth in Nigeria.
Keywords: Economics consequence, Conflict, Corruption perception index (CPI), Global peace Index (GPI) and Gross Domestic Product.
Citation: Olukotun, S. A. (2026). The Economic Consequences of conflict in Nigeria. J Business & Eco Insights.,2(4):1-7. DOI : https://doi.org/10.47485/3143-5807.1031