Theoretical and Applied Economics (Jun 2020)
Does the agriculture value-added contribute to the economic growth in 30 African countries?
Abstract
Not a long ago, the agriculture sector was the main pillar of any economy in the world. It not only provides food production, but it participates to the expansion of the economic growth as well. In this paper, we shall try to investigate the relationship between agriculture sector and economic growth for 30 African countries over the period of 1980-2017 with individual and temporal fixed-effect panel model and panel cointegration. We found with Pedroni and Westerlund tests that we have not a cointegration relationship between variables; hence we cannot estimate the long-run panel model. Therefore, we only estimated the panel model with individual and temporal fixed-effect, then we established that the two variables of economic openness relied to agriculture sector are positive, but insignificant, while the variable of the agriculture value-added was positive and statically accepted at the level of 1%, and the coefficient of the labour force in the agriculture sector appears negative and insignificant. The panel Granger causality showed that there is bidirectional causality between agricultural raw materials exports and imports, and the causality of Dumitrescu and Hurlin established that there are several causalities.
