Empirical Investigation of the Relationship Between Mining Investment and Economic Development in Mineral-Rich Local Government Areas of North West Nigeria

The resource curse hypothesis predicts that mineral wealth does not automatically translate into economic development, yet the empirical relationship between mining investment levels and local development outcomes has not been systematically tested at the sub-national level in Nigeria's North West zone. This study empirically investigates the relationship between mining sector investment and economic development indicators across 24 mineral-rich local government areas in Zamfara, Kebbi, and Katsina states over the period 2014 to 2023. A panel data econometric framework was employed, with mining investment proxied by annual royalty and tax payments and approved licence counts, and development indicators measured through composite indices of household expenditure, school enrolment, infant mortality, and access to improved water and sanitation from the Nigerian Living Standards Measurement Survey. Fixed-effects regression models were estimated to control for time-invariant LGA characteristics. Results reveal a statistically weak and inconsistent relationship between mining investment levels and development outcomes at the LGA level, consistent with the resource curse thesis. Mining-intensive LGAs show higher household income variance but no significant improvement in health or education indicators. Analysis of fund transfer records suggests that community development levies from mining are not consistently reaching LGA-level expenditure. The study recommends local content requirements, direct community investment funds, and local procurement obligations as mechanisms to improve local economic linkages from mining. Keywords: mining investment, economic development, resource curse, North West Nigeria, local government.