AGRICULTURAL PRODUCTION AND ECONOMIC GROWTH: AN ECONOMETRIC ANALYSIS OF THE IMPACT OF GOVERNMENT EXPENDITURE IN NIGERIA (1980 – 2018)

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CHAPTER ONE;INTRODUCTION

Agriculture continues to play a significant role in economic growth. Agriculture is the fundamental basis for each industrial economic revolution because, in addition to satisfying the need that humans have for their sustenance, it also provides the raw materials that are used as inputs in the manufacturing process. A Report on the State of World Development (2013), A rise in agricultural production was necessary in order to pave the way for the industrial revolution, which began in England in the middle of the 18th century and continued all the way through the 19th century in Japan. The paper also claimed that the recent explosive growth of agriculture in nations such as China, India, and Vietnam was a prelude to the expansion of industry in those countries. In nations where agricultural activity is on the rise, there is a corresponding rise in the amount of taxable surplus, which helps to boost overall government revenue. It is therefore without a shadow of a doubt to assert that agriculture served as the primary driver of economic growth and technological advancement in the majority of the developed nations of the world. Agriculture in the African circle has a significant potential to play a significant role in serving as an engine of quicker growth and decrease in poverty in the region. This is due to the fact that Africa is endowed with arable land, a massive population, and a suitable climate, all of which, if fully utilized, are capable of catapulting most of the countries on the continent onto the pedestal of economic growth and development. According to a fact sheet that was produced by the International Food Policy Research Institute in 2009, it was discovered that “in most African countries, agriculture is the engine of economic growth, and agricultural expansion is the corner stone of poverty reduction.” [Citation needed] Agriculture is the principal source of income for approximately sixty-five percent of the population in Africa. More than ninety percent of Africa’s agricultural output is the outcome of small-scale farming, which is primarily done in sub-Saharan Africa. Agriculture is responsible for between 30 and 40 percent of Africa’s Gross Domestic Product (GDP) and roughly 60 percent of the continent’s overall earnings from exports at the present time. Tochukwu, there is no doubt that the Agricultural sector has contributed to the economic progress and development that is currently being experienced in Africa (2010). In retrospect, this was put into perspective by Fan (2009), who stated that agricultural growth rates have increased somewhat, going from approximately 2.4 percent a year in 1980-1989 to 2.7 percent a year in 1990-1999 and 3.3 percent a year after the year 2000. The fact that the level of growth in agricultural productivity grew in response to the level of government expenditure in the sector is a fact that is both outstandingly impressive and remarkably outstanding.

Agriculture remained a dominant component of the Nigerian economy, despite experiencing a worsening fall as a direct result of crude oil production. Nigeria is certainly not excluded from these figures; agriculture remained a dominant component of the Nigerian economy. Before the discovery and subsequent finding of crude oil in the seventies, agriculture was the primary industry that propelled Nigeria to the forefront of the nation’s committees. Despite the growing importance of crude oil, Nigeria has largely remained an agrarian economy. Agriculture continues to account for shares in both the country’s gross domestic product and total exports, and it also employs the majority of the country’s workforce (Talabi, 2014). The productivity of agriculture as well as its contributions to the expansion of the national economy have been on the decline. According to the statistics that is available, agriculture, which had previously contributed more than 60 percent to the GDP in 1960, only provided about 25 percent between the years 1975 and 1979.

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