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Dynamics of Stabilization Policies and Investment Effects on Agricultural Output in Nigeria (1981-2019)

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  • Okidim, Iboh Andrew
  • Obe-Nwaka, Mba Oloi
  • Okuduwor, Adibie
  • Tuaneh, Godwin Lebari

Abstract

The dynamics of stabilization policies and the effects of investment on agricultural output in Nigeria were explored in this study. (1981-2019). The study specifically looked at the impact of investment, monetary policy, policy mix, and fiscal policy on agricultural output. World Development Indicators (WDI), Index mundi, and Macrotrends were used as sources for the annual time series data on the research variables for the period 1981–2019. The Autoregressive Distributed Lagged Model was used in the investigation. The unit root test revealed in the pre-diagnostic tests that the variables were 1(0) and I.(1). The ARDL Bound test for co-integration revealed that the variables related to fiscal, monetary, and policy mix had long-run co-integrating relationships while the variables related to investment had none. Additionally, empirical findings indicated that, in the short term, only government agricultural expenditure (P = 0.0007 < 0.05) as a fiscal policy variable affected agricultural output. Exchange rate (P = 0.0000 < 0.05) and inflation rate (P = 0.0000 < 0.05) as monetary policy variables significantly effected agricultural output. All policy mix variables significantly effected agricultural output in the short run. However, only private domestic investment (P = 0.0322< 0.05) as an investment variable significantly effected agricultural output.

Suggested Citation

  • Okidim, Iboh Andrew & Obe-Nwaka, Mba Oloi & Okuduwor, Adibie & Tuaneh, Godwin Lebari, 2023. "Dynamics of Stabilization Policies and Investment Effects on Agricultural Output in Nigeria (1981-2019)," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 11(2), April.
    • Handle: RePEc:ags:ijfaec:334708
    DOI: 10.22004/ag.econ.334708
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    References listed on IDEAS

    as
    1. Adekunle, Wasiu & Ndukwe, Innocent, 2018. "The Impact of Exchange Rate Dynamics on Agricultural Output Performance in Nigeria," MPRA Paper 87750, University Library of Munich, Germany.
    2. Bodunrin, Olalekan Samuel, 2016. "The Impact of Fiscal and Monetary Policy on Nigerian Economic Growth," MPRA Paper 92811, University Library of Munich, Germany.
    3. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    4. Linus Osuagwu, 2020. "Research Methods: Issues and Research Direction," Business and Management Research, Business and Management Research, Sciedu Press, vol. 9(3), pages 46-55, September.
    5. Olufemi Samuel Adegboyo & Sunday Anderu Keji & Oluwadamilola Tosin Fasina, 2021. "The impact of government policies on Nigeria economic growth (case of fiscal, monetary and trade policies)," Future Business Journal, Springer, vol. 7(1), pages 1-14, December.
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