Agricultural Expenditure Research Articles

Assessing investment priorities for inclusive agricultural transformation in Tanzania

AbstractMotivationPolicy‐makers dealing with conflicting development goals and constrained budgets must comprehend the relative cost effectiveness of agricultural and rural development initiatives.PurposeWe assess the impact of alternative interventions on development outcomes—economic growth, job creation, poverty reduction, and diet quality—to inform decision‐making and resource allocation in Tanzania's agriculture. We analyse trade‐offs among development objectives and explore budget reallocation to enhance the efficiency of public spending.Approach and methodsWe used a computable general equilibrium (CGE) model linked top‐down with microsimulation modules to simulate the impact of public investment options.FindingsNo single option emerges as the most effective across all development objectives. Investments in improved inputs and extension for horticulture and cash crops stand out for diet quality and employment creation. Livestock services show consistently high rankings across multiple objectives. Investments to boost cereals and root crops promote growth and reduce poverty but do little to increase employment and diet quality.Budget reallocation towards more cost‐effective interventions can significantly enhance the development effectiveness of Tanzania's agricultural expenditures and would substantially increase cumulative gross domestic product growth between 2019 and 2028.Policy implicationsPolicy‐makers can use the findings to design and prioritize agricultural interventions that better align with broader development objectives. Tanzania can achieve higher benefits and contribute to overall development goals by reallocating resources towards more cost‐effective expenditure options.

Government Expenditure and Economic Growth of Nepal

Purpose: This study aims to analyze the relationship between various categories of government expenditure and economic growth in Nepal. The purpose is to understand how these defense, health, agriculture and education expenditures influence economic performance and offer insights for more effective resource allocation.Methods: This research used a combination of descriptive and causal research designs, using secondary data sourced from published reports. Data from 1976 to 2022 AD were selected for its comprehensive data availability and analyzed.Results: The findings reveal that defense expenditure has a negative and significant association with economic growth, suggesting that high levels of defense spending are detrimental to economic development. Conversely, health and education expenditures show positive and significant relationships with economic growth, highlighting the importance of investing in human capital for fostering sustainable development. Agriculture expenditure, although positively related to economic growth, is statistically insignificant, indicating the need for policy refinements to enhance its impact. Conclusion: The study underscores the necessity for strategic reallocation of government resources. Reducing defense expenditures and increasing investments in health, education and agriculture are essential for promoting robust and sustainable economic growth.

Public expenditure and performance of the agricultural sector: evidence from Sri Lanka

This study investigates the influence of agricultural public expenditure on the performance of Sri Lanka's agriculture sector. Utilizing data sourced from the annual reports of the Ministry of Finance spanning 2011 to 2022, the findings reveal a significant and positive correlation between the recurrent expenditure of the Department of Agriculture (DoA) and the gross domestic production of the agriculture sector (p < 0.01). However, no statistical evidence supports a significant relationship between the Ministry of Agriculture's (MoA) capital expenditure and DoA and the performance of the agriculture sector. These results underscore the pivotal role of public recurrent agricultural expenditure in bolstering the agriculture sector's performance. Particularly noteworthy is the significant impact of DoA's recurrent expenditure on sectoral performance. The study advocates for increased budget allocation towards recurrent expenditure within the agriculture sector, especially emphasizing the importance of augmenting the DoA's recurrent expenditure to ensure enhanced performance and sustainability. Ultimately, the study underscores the critical importance of effective and efficient management of public funds in driving the agriculture sector's performance.

Can fiscal expenditure for agriculture mitigate the impact of climate change on agricultural production?

The profound impact of climate change on agricultural production, and the government’s fiscal expenditure for agriculture, is considered a crucial means to address this challenge. This study utilizes panel data from all prefecture-level cities in Heilongjiang Province from 2000 to 2020. Drawing upon the Cobb–Douglas production function, an economic climate model is constructed to empirically analyze the impact of climate change on grain yield in Heilongjiang Province. Furthermore, the role of fiscal expenditure for agriculture in mitigating the effects of climate change on grain yield is explored. Feasible Generalized Least Squares (FGLS) estimation is employed to address issues of “heteroscedasticity,” “autocorrelation within groups,” and “cross-sectional contemporaneous correlation” present in the model. The results indicate that climate change has a positive impact on rice and corn yields, while exhibiting a negative impact on wheat yield. The influence of climate change on crop yield is both linear and nonlinear. Specifically, temperature demonstrates a linear relationship with rice and corn yields, whereas precipitation shows a significant inverted U-shaped relationship with rice and corn yields. The impact of climate change on grain production in Heilongjiang Province varies significantly across regions. Fiscal expenditure for agriculture has a significant positive effect on the yield of major grain crops in Heilongjiang Province. In addressing the impact of climate change on grain production, agricultural fiscal expenditure enhances the positive effect of precipitation on rice and corn yields, while diminishing the positive impact of temperature on corn yield.

Agricultural Sector Output and Economic Growth Sustainability in Nigeria

This study examined the impact of agricultural sector output on economic growth and sustainability in Nigeria. The data for the study were extracted from the Central Bank of Nigeria (CBN) Statistical Bulletin. The methodology adopted in the research is linear regression with the application of the Ordinary Least Squares (OLS) Technique. The E-views 10 was the econometric software used for the research. The major findings of the study reveal that agricultural output contributes negatively and insignificantly to economic growth, government agricultural expenditures contribute negatively and insignificantly to economic growth, rainfall contributes negatively and insignificantly to economic growth and foreign direct investment in the agricultural sector contributes negatively and insignificantly to economic growth. It is therefore the recommendation of this paper that the government of Nigeria should encourage farmers by giving soft loans for agricultural activities. This will help farmers meet with financial needs in terms of purchasing some seeds, hiring machines, etc. thereby boosting massive agricultural production in Nigeria.

Effect of exchange rate uncertainty, energy prices and sectoral spending on agriculture value added, household consumption, and domestic investment

The agricultural value chain is underpinned by the interdependence of agricultural value added, household consumption and domestic investment. Understanding the complex interactions between these microeconomic outcomes and the uncertainties in the macroeconomic variables of exchange rates, energy prices and sectoral spending remains under-researched. Therefore, this study examines the impact of exchange rate, energy prices and sectoral spending on agricultural value added, household consumption and domestic investment in Nigeria from 1981 to 2020. Using Kernel regularized least squares (KRLS), the results show that the average pointwise marginal effects of exchange rate and agricultural spending are positive, while the average pointwise marginal effect of energy price is significantly negative for the agricultural value-added model. The results also show that the exchange rate, energy prices and agricultural expenditure all have a positive effect on household consumption. Regarding domestic investment, the effect of the exchange rate is positive and statistically insignificant, while the effects of energy prices and agricultural expenditure are negative and statistically significant. The study recommends the need to strengthen the social safety nets currently in place in Nigeria to support households that are vulnerable to exchange rate fluctuations. In addition, incentives should be given to households and farmers to help use renewable energy sources such as solar or wind power for agricultural activities. Also, investment in value chains and agribusiness initiatives should be encouraged rather than just in crop production.

Fiscal agricultural expenditures' impact on sustainable agricultural economic development: Dynamic marginal effects and impact mechanism.

Sustainable agricultural economic development is the core task for achieving the objective of rural revitalization strategy in China, which cannot be separated from the support and guidance of fiscal policy, and agricultural industry integration is a key path for the fiscal promotion of sustainable agricultural economic development. This paper systematically examines the interaction mechanism between fiscal agricultural expenditures and sustainable agricultural economic development by using 31 provincial panel data in China from 2008 to 2020 and adopting a two-way fixed effect model, a panel quantile model, and a mediating effect model, respectively. The results show that the impact of fiscal agricultural expenditures on sustainable agricultural economic development is significantly positive, and appears a dynamic increasing trend with the agricultural development stage upgrading. Moreover, heterogeneity analysis shows that the effect of fiscal agricultural expenditures is more obvious for the samples in the central region and with a high share of primary industry. Further, a mediating effect test finds that agricultural industry integration plays a mediating mechanism between fiscal agricultural expenditures and sustainable agricultural economic development. Therefore, this paper proposes constructing a long-term investment mechanism for fiscal agricultural expenditures, formulating differentiated fiscal support policies for agriculture, and prioritizing support for agricultural industry integration, which provides theoretical support and policy inspiration for promoting sustainable agricultural economic development.

The impact of fiscal support for agricultural expenditure on rural residents' consumption: from a perspective of level and structure

PurposeAs China’s industrial structure continues to upgrade and optimize, the consumption capacity of rural residents gradually improves and the role of consumption in economic growth is increasingly prominent. Against the background of weak external demand, the untapped potential of rural consumption has become a key force in expanding domestic demand. As one of the important means that the government has long relied on, fiscal support for agriculture has played a crucial role in activating the rural consumer market. This manuscript aims to explore the impact of local fiscal support for agricultural expenditure (FSAE) on rural consumption in China, as well as to examine the mediating role of the level of rural financial development.Design/methodology/approachIn this manuscript, the authors use the provincial panel data of 31 provinces in China from 2000 to 2020. The data of all variables mainly come from China Statistical Yearbook and China Rural Statistical Yearbook. According to the variable selection above, 651 sample data of 31 provinces and cities across China from 2000 to 2020 are organized. In terms of methodology, multiple fixed-effects panel model is applied to regression.FindingsFirstly, FSAE varies significantly, while rural consumption slowly but steadily rises, with a relatively stable consumption structure. Secondly, FSAE has a significant positive effect on rural consumption. Thirdly, mediation testing indicates that mechanisms such as income, uncertainty and financial development have significant positive mediating effects on rural consumption. Thirdly, there is evident regional heterogeneity in FSAE’s impact on rural consumption. The Western regions, under government fiscal support, show a more significant effect on the elevation of rural consumption levels, while the role of FSAE in optimizing the consumption structure of rural residents in eastern and central regions is more pronounced.Originality/valueFirstly, a systematic examination of local FSAE and rural consumption has been conducted, enriching relevant theories. Secondly, utilizing econometric empirical methods to research the relationship between local FSAE and rural consumption provides an exploratory extension to empirical studies on rural consumption in China. This offers empirical evidence for local fiscal support in agricultural development and the promotion of rural consumption.

The role of institutional quality in the nexus between agricultural expenditure and agricultural production in Nigeria

The role of institutional quality in the nexus between agricultural expenditure and agricultural production in Nigeria

The Role of Institutional Quality in the Nexus between Agricultural Expenditure and Agricultural Production in Nigeria

The Role of Institutional Quality in the Nexus between Agricultural Expenditure and Agricultural Production in Nigeria

Impulse Response analysis, Agricultural Financing and EconomicGrowth in Nigeria

The study examined theimpulse response analysis of the effectsof agricultural financing on economic growth in Nigeria from 1981 to 2020, using time series data on Economic growth rate, Deposit Money Banks loans to agriculture, Government capital and recurrent expenditure, Bank of Agriculture loans, and interest rate on agriculture loan obtained from the Central Bank of Nigeria statistical Bulletin and Annual Reports, National Bureau of Statistics, and Bank of Agriculture. Themethodology adopted in the study is the ARDL Bounds Cointegration Approach based on the fact that the variables were not all stationary at same order of integration. The findings revealed that given themajor challenges facing the agricultural sector in Nigeria such as inadequate funding, economic growth was positively affected by Deposit Money Banks Loans and advances to Agriculture, Bank of Agriculture Loans, and Federal Government Agricultural Finance but negatively affected by Interest Rate on Agricultural Loans during the period under investigation. The study recommended that since the Federal Government Agricultural Expenditure positively affects agriculture, the federal government should initiate policies towards revolutionizing agriculture to make it more productive by investing more on agriculture and concluded that considering the fact that agricultural funding variables were found to impact positively on economic growth in Nigeria during the period under investigation, adequate agricultural funding is essential for economic growth in the Nigerian economy.

Nexus between government agricultural expenditures and agricultural credit: The role of sustainable agricultural growth and sustainable agricultural income

AbstractThis study aims to analyze the effects of fiscal expenditures by the government on agricultural credit by considering the mediating role of sustainable agricultural growth and sustainable agricultural income. This study uses panel data from 31 Chinese provinces for the period 2009–2021. For in‐depth analysis, the sample is divided into different regions ‐ eastern, central, and western. For the empirical estimations, the ordinary least squares (OL), fixed effect (FE), random effect (RE), two‐way fixed effect (FE), and two‐stage least‐squares (2SLS) methods are employed. The results of the study demonstrate a significantly positive connection between governmental agricultural expenditures (GAEs) and agricultural credit (AC). The findings of the mediation analysis highlight a significantly positive mediating role of sustainable agricultural income in the association between GAEs and AC. The results of the regional analysis reveal a positive connection between GAEs and AC in all regions. It is recommended that government should increase its investment in the agriculture sector through both direct and indirect means of fiscal support, it can improve the agricultural income of farmers at a sustainable level and the repayment ability of farmers and rural households, and it can make their easy access to AC from banks and other financial institutions.

Response of Agriculture Production to Change of Foreign Direct Investment and Public Agriculture Expenditure in South Africa: A Monte Carlo Simulation Analysis

The rationale of this paper was to investigate the response of agriculture production to the simultaneous shock of foreign direct investment and public agricultural spending in South Africa during 1991-2019. Data were collected from secondary sources and analyzed using Monte Carlo simulation. Results revealed that agriculture production is maximized at 1,73% if Foreign direct investment inflows, agricultural credit, and the number of employees increase by 10% while public spending is decreased by 10%. Hence, it is recommended that policymakers should combine FDI inflows in agriculture, and agricultural credit in a complementary manner, with emphasis to attract more extensive farm workers to ensure the sustainability of production in the agriculture sector in South Africa. This paper contributes to enhance agriculture sector by using the best combination of input in agriculture in order to maximize production.

The efficiency of agricultural spending in Italy: A territorial analysis

This paper assesses the efficiency of public agricultural expenditure in each Italian region through the analysis of regional budgets, both as a whole and in relation to specific agricultural policy measures. The degree of integration/complementarity between regional funds and Community funds of the second pillar of the CAP is also evaluated, in order to determine whether European resources are used by the Regions as a substitute for or in addition to regional measures. In Italy, public agricultural funding comes from three sources: the EU, the State, and the regions. While the literature on the effectiveness and efficiency of public spending in agriculture focuses on EU funds, the present research also takes into consideration the agricultural spending of Regions.This original analysis of agricultural spending at the regional level has been made possible by the databank of the CREA (Council for Agricultural Research and Economics), which has been gathering information on the allocations, payments, and remaining balances of regional accounts since 1990. The expenditure items for the agricultural sector included in the regional budgets were reclassified according to an original methodology created by the INEA (National Institute of Agricultural Economics, today CREA). The results show that the overall efficiency of public expenditure has improved over the last two decades (from less than 40% in 2000 to just over 50% in 2019). This improvement is quite evident in the South and the Islands and less so in the North. Agricultural policy measures that can be defined as "short term measures" (contributions to public and private entities involved in agricultural and forestry activities for running costs, such as salaries, telephone, electricity, etc.) show a good spending capacity, while measures requiring planning, such as business investments, still present difficulties. As regards integration/complementarity between regional funds and EU Fund for Rural Development Programmes (RDPs), the regions have been classified depending or whether or not they differentiate between the RDP financing and Budget financing. In the most recent period of 2014-2020, most regions have tended to target both sources of funding to support the same types of priority activities.

Optimal Size of Public Expenditure and Agricultural Growth in Togo: Evidence from Armey Curve

This paper examines, using the Armey curve approach, the possibility of the existence of an optimal size of agricultural public expenditure in Togo. Using annual data from 1987 to 2019, the results show that the actual size of public agricultural expenditure is much below the optimal size, which is 34% of agricultural GDP for total agricultural expenditure and 27% for agricultural investment. In the light of these results, it appears that the Togolese government can pursue the expansionary fiscal policy by increasing agricultural expenditure to the optimal level. The gap is very deep and requires a significant qualitative jump.

Effects of land use change and crop rotation practices on farmland ecosystem service valuation

Farmland can provide various ecosystem services such as food production, groundwater recharge, and carbon storage. However, the overall value of farmland ecosystem services and differences in their spatial distribution are rarely studied, particularly with regard to farmland with crop rotations. In this study, we developed an assessing framework for appraising the overall value of ecosystem services of farmland with crop rotations on the basis of Costanza’s global ecosystem service valuation method. Changhua County in central Taiwan is used as a case study to estimate the impact of land use change on its farmland ecosystem services. We also applied the Integrated Valuation of Ecosystem Services and Tradeoffs (InVEST) model to analyze the spatial distribution of individual ecosystem services. Results from the global ecosystem service value method indicates that land use change in the study area caused a steady decline in overall farmland ecosystem service value between 1981 and 2021. However, if the practice of farmland crop rotation is included, the proposed method for evaluating ecosystem services of farmland indicate an increase in total ecosystem service value (ESV). The overall ecosystem services of farmland with crop rotations assessed was between 1.27 and 1.69-fold higher than the gross domestic product (GDP) for farming in the region and between 17 and 45.3-fold higher than the agricultural expenditure reported by the local government. The findings of this study also suggest local government can reference the spatial distributions of ecosystem service to dynamically adjust subsidies and resources for farmland, thereby enhancing agricultural governance and achieving sustainability goals.

Does digital economy strengthen the income distribution effect of fiscal expenditure? Evidence from China.

The exponential growth of China's digital economy has exerted a profound influence on economic advancement and income distribution. To effectively tackle income inequality, it is essential to incorporate the analysis of digital economy development within the framework of fiscal expenditure. This study utilizes a comprehensive panel dataset encompassing 276 cities in China during the period from 2011 to 2020. Employing the fixed-effect model and instrumental variable method, the research investigates the influence of fiscal expenditure on the income gap while investigating the moderating effect of the digital economy. The key findings of the study can be summarized as follows: (1) In general, fiscal expenditure demonstrates a propensity to reduce the income gap. (2) Different categories of fiscal expenditure exhibit distinct effects on the income gap. Social security and employment expenditures do not significantly alleviate the income gap. Conversely, education expenditures and health expenditures tend to exacerbate the income gap. On the other hand, expenditures in agriculture, forestry, and water resources, as well as urban and rural affairs, effectively narrow the income gap. (3) The development of the digital economy enhances the capacity of fiscal expenditure to adjust income distribution, showcasing non-linear effects. From a fiscal expenditure classification perspective, the digital economy primarily enhances the effectiveness of income distribution adjustment for expenditures in sectors such as agriculture, forestry, water resources, and others. Based on these findings, this study proposes a set of future measures aimed at facilitating China's efforts to reduce the income gap within the framework of the digital economy. These measures encompass expediting the integration of the digital economy with government governance and advocating for the widespread adoption of digital government affairs platforms. By implementing these measures, China can gain valuable insights into effectively addressing income inequality and promoting more equitable economic outcomes within the context of the digital economy.

The Pull and Push Factors of Farm Income Diversification among Fluted Pumpkin (Telfairia occidentalis Hook) Farmers in Akwa Ibom State, Southern Nigeria

The study examines the magnitude and factors influencing agricultural income diversification among small-scale fluted pumpkin (Telfairia occidentalis) farmers in Akwa Ibom State in the south-south region of Nigeria. The required information was collected from Telfairia farmers using a structured questionnaire. A regression analysis tool was used to analyse the specific objective. The finding revealed an average farm income diversification index of 2.29 suggesting that agricultural income diversification among small-scale Telfairia farmers is high and disturbing. The empirical results revealed that farmers' household size, hired labour, and educational qualification are the major “push factors” of agricultural income diversification. In contrast, “the pull factors” are farmers' age, extension visit, membership in a social group, land size, the quantity of fertilizer and manure, and household labour. To intensify farm income earnings among small-scale vegetable farmers, it is recommended that the government should encourage child spacing and family planning among fluted pumpkin farmers as these would reduce the household size and family burden always carried along with agricultural expenditures. Providing input subsidies to small-scale vegetable farmers is important to cushion the adverse effect of increased production costs. Agricultural extension services should be strengthened to render more effective services to vegetable farmers. The formation of social groups should be encouraged, primarily through cooperative farming. The government of Akwa Ibom State should set up tractor hiring centres in all the local government areas; these would help reduce the hard time vegetable farmers encounter hiring labour.

Research on the Sustainable Development of Agriculture in China under the Policy of "Agriculture, Countryside and Farmers"

In order to explore the development level of agriculture in China and its influencing factors, this paper uses STATA software to make a statistical analysis of the related factors of agricultural development through descriptive statistical analysis, linear regression model, variance expansion factor test, White test and Ramsy test. It is found that the affected area of crops, effective irrigation area, agricultural labor force and financial agricultural expenditure have significant effects on agricultural development. This paper puts forward some substantive suggestions for promoting agricultural development from these aspects.

Effect of Fiscal Expenditure for Supporting Agriculture on Agricultural Economic Efficiency in Central China—A Case Study of Henan Province

The policy guidance and financial support for industrial development from public finance provide an important guarantee for practicing green and circular development of agriculture. By sorting out the development context of fiscal support for agriculture in Henan province in different historical stages, this paper analyzes the development status of fiscal support for agriculture and the agricultural circular economy in the province. Relying on data envelopment analysis (DEA), it measures the efficiency of the agricultural circular economy in Henan province in 2013–2019 using the Charnes, Cooper, and Rhodes (CCR) model, the Banker, Charnes, and Cooper (BCC) model, and super-efficiency DEA models and empirically analyzes the effect of the fiscal expenditure for supporting agriculture on the efficiency of the agricultural circular economy using the fixed effect model. According to the results, (1) the expenditure on comprehensive agricultural development of Henan Province was mainly supported by the government’s fiscal funds to such a degree that the proportion of fiscal funds from the central government exceeded 40% throughout the year. Particular stress was laid on the land governance projects of comprehensive agricultural development in the province. (2) The overall development level of the agricultural circular economy in Henan Province was low, and there were considerable gaps between cities (counties). Under the super-efficiency DEA model, only Hebi City, which ranked first in terms of average efficiency, achieved relative efficiency. (3) The fiscal expenditure for supporting agriculture had a positive incentive effect on the efficiency of the agricultural circular economy in Henan province, and the incentive effect became more significant after the time effect was controlled. Accordingly, this paper puts forward some targeted policy suggestions, which enrich the existing research on fiscal support for agriculture and agricultural circular economy at both theoretical and practical levels.