IDEAS home Printed from https://ideas.repec.org/a/ajn/agricu/v10y2025i6p1-8id475.html
   My bibliography  Save this article

Symmetric and Asymmetric Effects of Foreign Direct Investment on Agriculture Sector Performance: Evidence from Ethiopia

Author

Listed:
  • Yewbdar Taddesse
  • Girma Estiphanos
  • Tadele Mamo
  • Mandefrot Amare

Abstract

This study examines the symmetrical and asymmetrical impacts of agricultural FDI on the performance of Ethiopia's agricultural sector. It uses multivariate time series data from secondary sources spanning 1981-2021. The data include agricultural real GDP, agricultural FDI inflow, and selected macroeconomic variables. Linear ARDL and non-linear ARDL (NARDL) econometric models were employed for analysis. Results from the asymmetric ARDL model indicate that positive FDI shocks have a significant and favorable effect on agricultural real GDP by 0.05% in the long run. However, negative FDI shocks were found to be statistically insignificant. In the short run, increases in FDI inflow during previous periods significantly reduced current agricultural real GDP, while decreases in FDI inflow also significantly diminished current agricultural production. According to the symmetric ARDL model, there was no significant relationship between the two variables in either the short or long term. The Granger causality test revealed a unidirectional relationship from FDI inflow to agricultural real GDP. In conclusion, agricultural FDI inflow significantly affects the performance of agricultural real GDP in the long run; however, its positive effect is not automatic in the short run. Therefore, attracting more FDI inflow to the agricultural sector is recommended to address financial and technological gaps in Ethiopia's agriculture sector.

Suggested Citation

  • Yewbdar Taddesse & Girma Estiphanos & Tadele Mamo & Mandefrot Amare, 2025. "Symmetric and Asymmetric Effects of Foreign Direct Investment on Agriculture Sector Performance: Evidence from Ethiopia," Agricultural Development, Eastern Centre of Science and Education, vol. 10(6), pages 1-8.
  • Handle: RePEc:ajn:agricu:v:10:y:2025:i:6:p:1-8:id:475
    as

    Download full text from publisher

    File URL: https://ecsenet.com/index.php/2576-6740/article/view/475/180
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ajn:agricu:v:10:y:2025:i:6:p:1-8:id:475. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tracy William The email address of this maintainer does not seem to be valid anymore. Please ask Tracy William to update the entry or send us the correct address (email available below). General contact details of provider: https://ecsenet.com/index.php/2576-6740/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.