Export of Agricultural Product Growth Nexus in Ethiopia: A Time Series Analysis

Abstract

The agricultural export is an important lead of export growth, and its impact on profitable growth has grown a debating macro-economic policy program among scholars & policymakers. Therefore, the study examined Export of Agricultural Product Growth Nexus in Ethiopia A Time Series Analysis, on the data duo of 1990 to 2021; from World Bank & National Bank of Ethiopia. The study applied time series econometric techniques. The result of the study revealed that the Long- run and short- run effect of agricultural export (coffee export and oil seed export) are positive at 5% and 1% significant level independently. This implies, that these coffee and oil seed export had served productive export share to growth. The long run effect of pulse export didn't serve significant share of growth. But the short run effect of pulse export reveals a negative and significant at 1% showing that unproductive consumption. The error correction model result shows that, the former year’s error will be corrected in the current period at an adjustment speed of 82% which takes about 1.2 years to meet to its long- run static position after the short- run shocks. The researcher recommends the concerned body for better benefits of agrarian export, the government of Ethiopia has to play a significant role in icing better institutional policy arrangement and sound macroeconomic programs, which help to make export led growth by value adding other than exporting primary product and therefore, agrarian export suggested to be in further investment climate for better profitable development.

Keywords: Auto Regressive Distributed Lag, Agricultural Export, Economic Growth, Error Correction Model, Ethiopia.

DOI: 10.7176/JESD/14-15-01

Publication date:October 31^st 2023