Local Government Fiscal Autonomy and Its Impact on the Performance of Small and Medium Scale Enterprises in Nigeria

In the literature on the structure of government and its impact on development in the grassroot there is a resurgence in the focus on the role of Local Government as government in the grassroot level in stimulating economic activities that will significantly improve the general well-being of the populace and contribute to sustainable economic development. Situated within this focus, this study examined the impact of Local Government fiscal autonomy on the performance of Small and Medium Scale Enterprises (SMSE) in Nigeria. Using a questionnaire as instrument the study adopted a survey method and collected data from 248 entrepreneurs from the three senatorial districts of Akwa Ibom State in Nigeria. The correlation analysis of the data showed two insightful results-both the level of Local Government fiscal autonomy and its level of expenditure have significant impact on the performance and profitability of SMSEs. It therefore recommend for higher Local Government fiscal autonomy as an important step to stimulate inclusive economic activities and growth.