This study examine the impact of internally generated revenue IGR) on economic output in Kwara State from 1988 to 2017. The data were however analysed using Autoregressive Distributive Lag model (ARDL) and Vector Autoregressive (VAR). The ARDL test for co-integration at the levels of variables carried out by employing the Bound test within the framework of the estimated ARDL model. The first model is Autoregressive Distributed Lag (ARDL) model developed by Pesaran et al (2001), the second model is the Vector Auto regression (VAR) model which is employed to test for impulse response function and serves as a complement to estimated ARDL model. This was done by specifying and estimating of a regression model. Based on the first model, all the varibales were not statistically significant in determining the output level in the state which is contrary to previous studies such as Ogundayo, Onakoya and Afintini(2017);Augus and David(2011) amongst others established a conflicting results. similarly, results of the second model indicates that inflation rate, interest rate as well as gap(deficit) have negative impact on output which conform with the studies of Hakan, Ali and Hassan (2008; Faraji and Kenani(2013) Jelilov (2016) interest rate on output was contrary amongst others.Given the above findings, the study therefore recommended the followings amongst other:The state government should imbibe the culture of fiscal discipline as well as huge capital expenditure so as to ensure growth in output level in the state. Also, the government should ensure that more funds are being expended on developmental project rather than stomach infrastructure couple with adequate and properly monitoring in order to achieve inclusive growth of output similarly, The rate of interest should be market determined in order to encourage investment inflow into the state. Finally, Price control mechanism should be put in place with the aim of checkmating the undesirable effect of inflation rate on the economic output of the Kwara State, Nigeria.
THE IMPACT OF INTERNALLY GENERATED REVENUE (IGR) ON OUTPUT IN KWARA STATE (1988-2017)