Abstract
This research examined the impact of government expenditure and debt policy instruments on agricultural growth in Nigeria for the period 1980-2018. Findings revealed that, for every billion rise in aggregate government expenditure, agricultural growth significantly increased by 1.66%. Additionally, per capital income and inflation were significant determinants of agricultural growth. However, the response of agricultural growth to increased debt was inelastic with a coefficient of -0.3152. Thus, macroeconomic policy instruments dynamics impacted agricultural growth. It recommended increased government expenditure to agricultural sector, education, investing in human capital development through budgetary allocations and intervention funds for increased growth while policy makers should desist from increasing the debt profile as it gave less than proportionate effect on agricultural growth with negative consequences on the Nigerian economy.
Highlights
To attain agricultural sector goals, several policies were formulated and implemented after Nigeria’s independence
It recommended increased government expenditure to agricultural sector, education, investing in human capital development through budgetary allocations and intervention funds for increased growth while policymakers should desist from increasing the debt profile as it gave less than proportionate effect on agricultural growth with negative consequences on the Nigerian economy
The findings revealed that agricultural growth adjusted fairly to the dynamics of macroeconomic policy instruments in Nigeria
Summary
To attain agricultural sector goals, several policies were formulated and implemented after Nigeria’s independence. Some macroeconomic and sectoral policies implemented from 1970 to 1985 promoted growth with some shortcomings. According to Dayo, Ephraim, John and Omobowale (2009) government policies led to the provision of many farm inputs and services which helped in the production, processing, and marketing of farm commodities (Chimobi and Uche, 2010). Thereafter, growth indices of agricultural production fluctuated between stagnation and decline, a situation blamed mainly on policy reversals and inconsistencies. Government expenditure is a policy instrument targeted at influencing the level of production. Spending in agriculture is one of the most important government instruments for promoting economic growth (Sanyal, 2010; Fan et al, 2008; Ikpi, 1995).
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