Abstract

Premised on economic and political instability indicators, this paper examined the impact of FDI on the agricultural sector development of the Nigerian economy. This work employs secondary time series data which spanned 1981 to 2012, Following ADF test for stationarity and a granger causality test, the study found a relationship among the variables as affirmed by the error parameter. The study reveals that FDI positively impacted on agriculture not only in the short run but also in the long run. This will also engender domestic income diversification which will boost agricultural sector. Further, political instability adversely affected agricultural investments in the long run. An enabling environment should be provided to attract investment on short and long term basis.

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