Acta Univ. Agric. Silvic. Mendelianae Brun. 2016, 64(2), 691-700 | DOI: 10.11118/actaun201664020691

The Impact of Agricultural Exports on Economic Growth in Nigeria

Nahanga Verter, Vìra Beèváøová
Faculty of Regional Development and International Studies, Mendel University in Brno, Zemìdìlská 1, 613 00 Brno, Czech Republic

Agriculture is the backbone of Nigeria's socioeconomic development. This paper investigates the impact of agricultural exports on economic growth in Nigeria using OLS regression, Granger causality, Impulse Response Function and Variance Decomposition approaches. Both the OLS regression and Granger causality results support the hypothesis that agricultural exports-led economic growth in Nigeria. The results, however, show an inverse relationship between the agricultural degree of openness and economic growth in the country. Impulse Response Function results fluctuate and reveal an upward and downward shocks from agricultural export to economic growth in the country. The Variance Decomposition results also show that a shock to agricultural exports can contribute to the fluctuation in the variance of economic growth in the long run. For Nigeria to experience a favourable trade balance in agricultural trade, domestic processing industries should be encouraged while imports of agricultural commodities that the country could process cheaply should be discouraged. Undoubtedly, this measure could drastically reduce the country's overreliance on food imports and increase the rate of agricultural production for self-sufficiency, exports and its contribution to the economic growth in the country.

Keywords: economic growth, degree of openness, Granger causality, REER
Grants and funding:

The authors appreciate IGA FRRMS MENDELU (No. 2016/012): 'Agricultural Production, Trade and Economic Growth in the Sub-Saharan African (SSA) Countries' for the financial assistance during this research.

Prepublished online: May 4, 2016; Published: May 1, 2016  Show citation

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Verter, N., & Beèváøová, V. (2016). The Impact of Agricultural Exports on Economic Growth in Nigeria. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 64(2), 691-700. doi: 10.11118/actaun201664020691
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