On Agricultural Performance amidst Macroeconomic Instability in Nigeria; Autoregressive Distributed Lagged Modelling (2010Q1-2017Q4)

Abstract

The interaction among macroeconomic indicators causes shock among themselves and by extension shocks on other macroeconomic variables including agricultural performance. This study investigated agricultural performance amidst macroeconomic instability in Nigeria. Data on the study variables spanning from first quarter of 2010 to the fourth quarter of 2017 was sourced from the Statistical Bulletin of the Central Bank of Nigeria. Diagnostic checks revealed that the variables were integrated of order I(0) and I(1) hence the used of the Autoregressive Distributed Lagged model The cointegration bounds test indicated a long run cointegration consequently the  ECM which results showed a correct sign, significant effect and 40.1% speed of adjustment. Empirical, results also indicated that; 91.3% variation in agricultural sector performance was explained by the adopted explanatory variables of the parsimonious model (R2 =0.913). Particularly, changes in the fourth lag of agricultural sector performance, current period exchange rate, the first, second and third lag of exchange rate were significant determinant of agricultural performance within the period under review.