A Constitutional Political Economy of Nigeria’s Petroleum Revenue Allocation: Original Theory and Reform Implications

This study develops an original constitutional political economy (CPE) of Nigeria's petroleum revenue allocation system, theorising how the interaction between constitutional fiscal federalism rules and political economy incentives has produced a dysfunctional revenue sharing architecture that undermines both intergovernmental equity and macroeconomic stability. Constitutional political economy, which examines the political economy dynamics of constitutional rules rather than merely their legal content, has not previously been systematically applied to Nigerian petroleum law. The research employs a theoretical and empirical CPE methodology, combining formal constitutional analysis of revenue sharing provisions, historical institutionalist analysis of allocation formula politics from 1979 to 2024, and statistical analysis of FAAC distributional data. Original empirical contributions include a time-series analysis of how derivation formula adjustments have responded to political pressures and a formal model of elite bargaining over petroleum revenue shares. Theoretical contributions include an original CPE theory of petroleum fiscal constitutionalism applied to Nigeria's multi-ethnic federation and a reform framework for constitutionalising counter-cyclical revenue management rules. These theoretical contributions are significant for constitutional law, fiscal federalism, and petroleum governance scholarship. Keywords: constitutional political economy, petroleum revenue, fiscal federalism, Nigeria, reform theory.