Abstract
Agriculture is both the main sector that is expected to provide employment to large segments of the population and the key to sustained economic growth of the countries. This study presented an empirical analysis of the effect of Agricultural Exports on economic growth of Nigeria. The model built for the study proxy gross domestic product as the endogenous variable measuring economic growth as a function of real exchange rate, real Agricultural exports, Index of Trade Openness and Inflation rate as the exogenous variables. Annual time series data was gathered from Central Bank of Nigeria Statistical bulletin, National Bureau of Statistics (NBS), CBN Economic and Financial Review Bulletin and CBN annual reports spanning from 1970 to 2012. The study used econometric techniques of Augmented Dickey-Fuller (ADF) unit root test, Johansen co-integration test and error correction method (ECM) for empirical analysis. The results of unit root suggested that index of trade openness and inflation rate was stationary at a level while real gross domestic product, real exchange rate and real agricultural exports were integrated at order one. The co-integration test showed that, long-run equilibrium relationship exist among the variables. The findings from the error correction method show that Agricultural Export has contributed positively to the Nigerian economy. The study recommended that, the government reform agenda should be systematic and sustained irrespective of the professional background of the successive presidents of the country and that; Agricultural production should be more desired than other sectors that are exhaustive in nature (oil) evidenced to the recent fall in price of crude oil which has rendered Nigeria in economic shambles. Key words: Agricultural exports, economic growth, trade openness, Dutch disease and exchange rate.
Highlights
Agriculture has been the most important single activity in the Nigerian economy, with about 70% of the total working population engaged in it
The estimated coefficient indicates that about 1.33% of this disequilibrium is corrected between one (1). Year This means that, the speed of adjustment to where the agricultural export will equilibrate the real Gross Domestic Product in Nigeria is at the rate of 1.33%. Empirical evidence from these analyses and results have shown that agricultural export can be as lucrative and profitable as any other sector of the Nigerian economy with respect to returns on investment
Since recent shock in oil prices could render Nigeria in economic shambles, much attention is needed in the agricultural sector to overcome such subsequent challenges
Summary
Agriculture has been the most important single activity in the Nigerian economy, with about 70% of the total working population engaged in it. It is the largest single sector of the economy, providing employment for a significant segment of the workforce and constituting the mainstay of the Nigeria large rural community which accounts for nearly two-third of the population. The rise of agricultural export has been a considerable success story and one that has brought numerous benefits to Nigeria the importance of export to a nation‟s economic growth and development cannot be overemphasized since it is a catalyst necessary.
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