The study explored the effect of government capital expenditure on manufacturing sector output in Nigeria using time series data from 1981 to 2018. The manufacturing sector output taken as the total volume of inflation-adjusted value of output produced by all the manufacturing industries was the dependent variable. The government capital expenditure was disaggregated into four functional expenses as capital expenditures on the road, health, communication, and power (electricity). The annual time series data employed were analysed for unit roots using the augmented Dickey-Fuller (ADF), and regression techniques based on the Autoregressive Distributive Lag (ARDL) to determine the relationships. The findings revealed that capital expenditure on road infrastructure has a short-run positive significant effect on manufacturing sector output, but an insignificant adverse impact on manufacturing sector output in Nigeria; capital expenditure on health has significant impacts on the manufacturing sector output in Nigeria driving at negative in the short run and then positive in the long run; capital expenditure on telecommunication has a significant positive impact on manufacturing sector output in Nigeria both in the long-run and short-run; whereas capital expenditure on the power supply has an insignificant negative effect in long and short periods. The study hence recommended increased expenditure on road, health, electricity and telecommunication to boost the manufacturing sector propensity for growth and productivity.
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