AGRICULTURAL OUTPUT AND PER CAPITA INCOME: EVIDENCE FROM NIGERIA
Osagie Osifo1, Lawson E. Igbinovia,2 Peter .O. Eriki3
1Department of Banking and Finance, University of Benin, Benin, Nigeria.
2Department of Banking and Finance, University of Benin, Benin, Nigeria.
3Department of Banking and Finance, University of Benin, Benin, Nigeria.
The study empirically examines the impact of agricultural output on per capita income in Nigeria for a period of thirty-two years (1980 to 2015). The study employs multiple Ordinary Least Squares (OLS) analysis for the estimation process, unit root test for stationarity variables, co-integration analysis for long-run equilibrium relationship and error correction model to ascertain the short run effect of the variables. The variables used in the model were per capita income which is the dependent variable, while agricultural output (AGQ), index of industrial production (INDPR), agricultural exports (EXP) and investment (INV) served as the independent or explanatory variables.
The results from the analysis showed that agricultural output (AGQ) and agricultural exports (EXP) have a significant positive relationship with per capita income. Index of industrial production (INDPR) and that of investment (INV) have insignificant positive relationships with Per capita income (PCI).
The study recommends among others that since agricultural output, not just mere exports that boosts per capita income, relevant authorities should consider measures of increasing the share of agricultural output in Nigeria by providing the farmers with high yielding varieties of crops and teaching them better farming and preservation methods through a revamped agricultural extension system.
Key Words: Agricultural output, Per Capita Income, Exports, Investment, Industrial Production.