Macroeconomic Policies and Growth: Expectations, Structural Realities, and Theoretical Weaknesses

This article evaluates how macroeconomic policies shape long-term economic growth when viewed through the lens of foundational and contemporary growth theories. It analyzes the core tenets, policy expectations, and fundamental weaknesses of these theoretical frameworks when applied to real-world macroeconomic management, with a specific focus on developing regions like Nigeria. By reviewing resource-based, export-led, Schumpeterian, structuralist dual-economy, classical stage-based, Harrod-Domar, neoclassical, and endogenous growth models, this paper uncovers a deep disconnect between abstract theoretical assumptions and empirical realities. Our analysis reveals that while growth theories offer essential blueprints for fiscal, monetary, and trade policies, their execution in developing countries is routinely undermined by weak institutions, Dutch Disease dynamics, volatile commodity markets, structural rigidities, and missing domestic value chains. The study concludes that sustainable economic growth cannot be achieved by blindly adhering to a single growth model. Instead, it requires a flexible, structurally adaptive macroeconomic policy mix that pairs targeted industrial strategies with institutional reforms, technological accumulation, and genuine economic diversification.