Does Exchange Rate Devaluation Affect Agricultural Output? Evidence from Nigeria

Oye, Olubukoye Opeyemi; Lawal, Adedoyin Isola; Eneogu, Ann; Iseolorunkanmi, Joseph

doi:10.21512/bbr.v9i2.4139

Cited by 7 publications

(5 citation statements)

References 32 publications

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“…Finally, the coefficients of the current and lagged values of inflation, though negative, are statistically not significant in influencing growth. These outcomes contradict Abbas et al (2014), Okoye et al (2018) and Ehikioya (2019) that inflation is a negative predictor of economic growth but align with the positive outcome documented in . The model diagnostics reveal that the R-squared value of 0.812 indicate that 81.2% variation in growth is explained by the regressors, the F-statistic (4.033608) also indicates that the regressors are jointly significant in explaining economic growth while the Durbin-Watson (D-W) statistic of 2.224311 indicates existence of no serial correlation.…”

Section: Long-run Regression Resultsmentioning

confidence: 55%

“…The authors observe significant positive effect of lagged GDP on current rate of economic performance, as well as robust positive effect of inflation on the real economy. In another study, Okoye et al (2018) The study also provides empirical validation of negative effect of exchange rate volatility and inflation rate on real sector performance.…”

Section: Balsalobrementioning

confidence: 95%

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Analyzing the Energy Consumption and Economic Growth Nexus in Nigeria

Okoye

Omankhanlen²,

Okoh³

et al. 2020

IJEEP

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Public and private sectors across the globe formulate and implement policies that target growth of their operations. It is of essence therefore that economic managers and other stakeholders identify and engage key factors that promote economic activities in policy formulation. The connection between economic performance and energy utilization is acknowledged in the literature, but empirics on the nature of this relationship produce mixed outcomes thereby suggesting the need for more research. Using the auto-regressive distributed lag method, this study estimates the effect of energy consumption on economic growth in Nigeria between 1981 and 2017, incorporating financial development, gross fixed capital formation and inflation for enhanced robustness. The results indicate that energy consumption and gross fixed capital formation (proxy for infrastructure) significantly determine growth of economic activities in Nigeria. The study also presents empirical support for delayed response of an endogenous variable to its own shocks as well as shocks to explanatory variables. It therefore asserts that energy consumption is a major determinant of economic growth in Nigeria, and aligns with the energy-led hypothesis. The observed positive impact electricity and capital consumption provides empirical support for the endogenous growth theory. Increased government and private sector investment in energy and infrastructural development is strongly advocated.

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Section: Long-run Regression Resultsmentioning

confidence: 55%

Section: Balsalobrementioning

confidence: 95%

Analyzing the Energy Consumption and Economic Growth Nexus in Nigeria

Okoye

Omankhanlen²,

Okoh³

et al. 2020

IJEEP

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“…They also discover that variations in US output derive mainly from domestic shocks. Okoye et al (2018) used the method of ordinary least squares (OLS) to study the link between exchange rate management and economic development in Nigeria between 1970 and 2016. The study presents significant negative effect of exchange rate on economic development.…”

Section: Review Of Related Literaturementioning

confidence: 99%

Effect of Energy Utilization and Financial Development on Economic Growth in Nigeria

Okoye

Omankhanlen²,

Okoh³

et al. 2021

IJEEP

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The necessity for rapid economic growth has not only been of great concern to global institutions and agencies but has continued to dominate discussions at major economic conferences at the national and international levels. There is an implicit assumption of positive correlation between economic growth, as measured by increase in national output, and the welfare of citizens, with the effect that governments seek to understand the real causes of output growth to aid formulation and implementation of policies that promote the welfare of their citizens. The depth of academic research in this area of knowledge is a further indication of its relevance to humanity. This study builds on existing body of knowledge on the subject by estimating the contributions of the financial and energy sectors to the Nigerian economy between 1981 and 2018. Using the estimation method of dynamic ordinary least squares (DOLS), the study reveals electricity consumption, inflation and financial development as positive predictors of growth while oil price and gross fixed capital are negative predictors. From the above findings, we conclude that robust financial and energy sectors are major influencers of growth and therefore suggest that adequate attention be given to development of these sectors through formulation and implementation of supportive policies. In addition, we see the necessity for a need assessment of the infrastructure needs of the real sector in order to ensure that infrastructure critical to its performance is identified and addressed through targeted investment.

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“…Empirical literature revealed exist mixed results on the impact of monetary policy variables on the agricultural sector output and GDP (Adongo et al, 2020;Onyiriuba et al, 2020;Mashinini et al, 2019;Adekunle and Ndukwe, 2018;Oye et al, 2018;Musa, 2015;Muroyiwa and Sibanda, 2014;Arize et al, 2003). Hence, broad money supply and exchange rate, which are also intertwined, can be seen as impetus to agricultural financing and, consequently, agricultural gross domestic product; and have been, therefore, selected for this study.…”

Section: Introductionmentioning

confidence: 99%

Impact of Broad Money and Exchange Rate on Agricultural Gross Domestic Product: An Unrestricted Var Model Approach

Ogbanje¹,

Ihemezie²

2021

JASD

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Expansionary monetary policy is a major driver of economic changes via money supply. Broad money, which represents total money supply in an economy, has several economic impacts. The study examines the impact of broad money (MS2) and exchange rate (XR) on agricultural gross domestic product (AGDP) in Nigeria. Secondary data from 1981 to 2018were obtained from the Central Bank of Nigeria. Descriptive statistics, Augmented Dickey-Fuller, Johansen Co-integration test and Vector Autoregression model were employed. Broad money had a large coefficient of variation. Variables were stationary at the first difference, supported by a spurious regression of d1lnagdp on d1lnms2 and d1lnxr whose R2 (0. 2411) was greater than Durbin Watson statistics (1.889914). Johansen's Co-integration test rules out the long-run relationship. Using the AGDP model of the VAR, the result shows that the chi2 statistic (16687.39) is statistically significant (P<0.01), with an R2 of 0.9978. Ms2 and XR have coefficients of 0.3389 and 0.2502, respectively, with statistically significant (P<0.01) and z-statistics of 3.92 and 5.44, respectively. The findings suggest increased broad money for increased agricultural gross domestic product. An increase in the exchange rate should be adopted for an increased agricultural gross domestic product but with caution to forestall the trade-off effect on inflation.

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Does Exchange Rate Devaluation Affect Agricultural Output? Evidence from Nigeria

Cited by 7 publications

References 32 publications

Analyzing the Energy Consumption and Economic Growth Nexus in Nigeria

Analyzing the Energy Consumption and Economic Growth Nexus in Nigeria

Effect of Energy Utilization and Financial Development on Economic Growth in Nigeria

Impact of Broad Money and Exchange Rate on Agricultural Gross Domestic Product: An Unrestricted Var Model Approach

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