Agriculture in Place of Crude Oil Production as an Alternative Income Earner for Nigeria: A Cointegration Analysis Approach

Abstract

Aims: To examine the contribution of agriculture as an alternative to crude oil production on the Nigerian economy using cassava production as proxy. Study Design : Johansen - Juselius co - integration proc edure and error correction models are adopted. Place and Duration of Study: The data used in this study are from secondary sources. Data on gross domestic product per capital (GDPPC), and naira exchange rate (ER) are obtained from NGA_Country Meta Data_Agr ic 2013, while that on cassava production (CAS) are obtained from FAO Statistics Division 2013. Data covered 1980 and 2010. Methodology: The study uses Johansen - Juselius co - integration procedure to examine a possible long run equilibrium among GDPPC, CAS, and ER. Unit root, Granger - causality, and cointegration tests were conducted. Results: All variables are integrated of order one. Causality test indicates that both CAS and LEXH Granger cause GDPPC. The causality is one - way. Both trace and max - eigenvalue t ests indicate 1 cointegrating equation with P=0.0296 and 0.0255 respectively. Johansen - Juselius co - integration procedure identified a long run equilibrium among gross domestic product per capital, cassava