Impact of Climate Variability, Agricultural Expenditure and Arable Land Expansion on Food Output in Nigeria (1978-2009): A Bounds Cointegration Approach

Abstract

This study was carried out to investigate the impact of climate variability, aggregate agricultural expenditure, level of aggregate farm mechanization (farm technology) and arable land use on food output in Nigeria from 1978 to 2009. Secondary data were obtained from Central Bank, National Bureau of Statistics and World Bank and analyzed using Autoregressive Distributed Lagged (ARDL) model. The series were first tested for stationarity using Augmented Dickey Fuller and Philips Perron tests. The ARDL model was then applied after confirming that the series were mixture of I(0) and I(1). Tests for serial correlation (Breusch-Pagan test), stability (CUSUM), specification (RAMSEY RESET), heteroscedasticity and Jarque-Bera normality tests were also conducted. These tests validated the variables and specification of the model applied. The model showed a good fitting with an  R² of 0.71. The statistically significant F-ratio (p<0.01) of 4.72 (greater than critical bound level of 3.74) confirmed cointegration of the series. Results showed that on the long-run, climate variability (rainfall), level of aggregate farm mechanization and arable land use exerted significant positive effects (p<0.01) on food production in the country. Nonetheless, its effect was considered to be negative in the ong-run. Thus, it was concluded that Nigerian government should concentrate on ensuring the efficiency of agricultural expenditure through prudence and proper accountability.In addition, agricultural transformation based programmes should be in place to improve agricultural mechanization and building capacities of farmers to adopt climate resilient technologies such as investment in irrigation facilities especially in the semi-arid regions of the country.