Analysis of the Effect of Urbanisation on Economic Inequality in Abuja, FCT

Rapid urbanisation in the Federal Capital Territory has attracted population and economic activity but may simultaneously be widening inequality gaps, and examining the urbanisation-inequality nexus in Abuja provides evidence for inclusive urban economic policy. This study analysed the effect of urbanisation on economic inequality in Abuja Municipal Area Council and Bwari Area Council, Federal Capital Territory, between 2015 and 2022. Secondary data on urbanisation rates, income distribution, and the Gini coefficient from the NBS were supplemented by a household survey of 250 respondents covering urban and peri-urban areas. The Gini coefficient, Kuznets Curve hypothesis test, and regression analysis were applied. Results showed that Abuja's urbanisation rate increased from 68.4 percent to 78.2 percent over the study period. The Gini coefficient for the FCT rose from 0.42 to 0.47, indicating increasing inequality. Peripheral areas like Bwari showed Gini coefficients above 0.52, reflecting particularly acute inequality. Higher-income households concentrated in core urban areas while lower-income migrants clustered in peri-urban settlements with inadequate infrastructure. Urbanisation showed an inverted U-shaped relationship with inequality consistent with the Kuznets hypothesis at the urban level. The study concludes that urbanisation in Abuja is associated with widening inequality, concentrated in peri-urban communities. Recommendations include inclusive housing policy, investment in peri-urban infrastructure, and urban job creation programmes targeting recent migrants and low-income residents.

Keywords: urbanisation, economic inequality, Abuja, Gini coefficient, Kuznets curve