Market liberalization and maize production in Nigeria

Abstract

This study examined the impact of market liberalization on maize production in Nigeria. Time series data for a 29-year period (1970 - 1998) were collected. Zellner’s seemingly unrelated regression (SUR) model was used as the estimation technique. Output of maize was found to be more during liberalization. Fertilizer price and hectarage planted to maize were the significant variables affecting maize output. Fertilizer consumption was found to be affected by hectarage planted to maize and crop loan. Retail price of fertilizer was determined by the factory gate and world prices of fertilizer. For hectarage planed to maize, crop loan, government expenditure, and the relative price of maize to millet, were the significant explanatory variables. For output of maize and hectarage planted to maize, the dummy variable (0, for pre-liberalization and 1 for liberalized period) were significant. This means that market liberalization did affect these variables. However for fertilizer consumption and fertilizer price, the dummy variables were non-significant and this implied that market liberalization had no impact on fertilizer consumption and fertilizer price. Conclusion is that market liberalization if properly implemented had a positive impact on maize production in the country. Key words: Market liberalization, maize production, Nigeria.