Empirical Analysis of the Correlation between Exchange Rate Deregulation and Agricultural Contribution to the Gross Domestic Product in Nigeria
Over the years, the role of exchange rate on the Nigerian Gross Domestic Product (GDP), specifically agricultural produce has been an issue. This paper investigated the correlation between exchange rate deregulation and the agricultural contribution to GDP in Nigeria. The research work employed econometric tools, using time series data covering a period of eighteen (18) years (2000 – 2018). The Augmented Dickey Fuller test, the Autoregressive Distributed Lag (ARDL, and the Error Correction model (ECM) were utilized to estimate the data obtained from the Central Bank of Nigeria (CBN) annual statistical bulletin. The results obtained from the study showed that a negative relationship exist between Exchange Rate (EXR) and the Agricultural Share of Gross Domestic Product (AGDP). The implication of the above result is that, a floating exchange rate policy over the years has been having economically not-friendly trend in agricultural share of the GDP in Nigeria. The study, therefore, recommended that, government should introduce policies like: price ceiling and quantity quota to limit the exchange rate volatility, and encourage export-oriented policies that will help to strengthen the naira against the dollar.
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