Year: 2026
Type: article
Abstract: This study examined the impact of exchange rate policy on agricultural productivity in Nigeria over the period 1990–2024, incorporating key macroeconomic variables such as agricultural credit, technological investment in agriculture, interest rate, exchange rate and inflation rate. Agricultural productivity (AGRP) was employed as the dependent variable, while the vector error correction (VECM) model was used to analyzeboth short-run dynamics through lagged difference terms and long-run coefficients through the error correction term simultaneously.The findings showed that agricultural competitiveness is highly persistent and largely influenced by its past values, indicating strong path dependency within the sector. Exchange rate movements exhibited a lag-dependent effect, with positive impacts in the short-to-medium term and negative effects in the long term. Agricultural credit demonstrated weak positive effects in the short run but negative effects in the long run, suggesting inefficiencies in credit allocation and utilization. Similarly, agricultural investment showed negative short-run effects due to adjustment costs, although its long-run importance remains significant. Interest rate was found to exert a negative influence on agricultural competitiveness in the long run, while inflation displayed mixed effects over time. The study concludes that exchange rate policy and macroeconomic conditions affect agricultural competitiveness primarily through delayed transmission mechanisms. It recommends the adoption of stable exchange rate policies, improved credit management, lower interest rates, sustained investment in agricultural technology, and enhanced policy coordination to promote long-term competitiveness and growth in the agricultural sector.
Institutions: Edo State University Uzairue, Auchi Polytechnic
Language: English
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W7203740233