The Demand for Inputs and the Supply of Output in Pakistan: Estimating a Fixedeffects, Distributed-lag Model for Wheat Farmers

Abstract

Agricultural growth in Pakistan over the past 3 decades has been very impressive, averaging 3.3 percent annually over the period 1965-80, and accelerating to 4.3 percent per year over the period 1980-90. But as impressive as these numbers are, questions arise regarding the success of the agricultural sector in terms of meeting food and employment needs, the potential for continuing or increasing growth rates in the future, the likely sources of future agricultural growth, and the technologies, policies, and institutional arrangements necessary to achieve that growth. The truth is that agriculture in general, and food production in particular, have been working hard to just to keep pace with other sectors and with the food needs of the domestic population. Agriculture was the slowest growing sector in Pakistan over the past 30 years, with general economic expansion moving along at an average of 5.2 percent annually over the 1965-80 period, and of 6.3 percent per year over the decade of the 1980s. In addition, in spite of very . substantial production and productivity gains for most major crops, the average index of food production per capita remained constant over the 1980-90 period, while the total volume of cereal imports nearly doubled to over 2,048,000 metric tons [World Development Report (1992)].