Reconsidering agricultural credits and agricultural productivity nexus: Evidence from a global representative panel data      

Abstract

Access to credit has been a key component in protecting agriculture sector against uncertainties and climaterelated shocks. Agricultural credits may also increase both agribusiness sectors' and farming-related commercial activities' exposure to world markets. The purpose of this study is to investigate the short-run and long-run effects of agricultural credits on agriculture value added using some other control variables such as foreign direct investments and government expenditures. Employing combined autoregressive distributed lag (ARDL) panel approach and Dumitrescu-Hurlin Panel Causality tests with global data from 2000-2018, we found that credits to agriculture affects agricultural productivity positively in the long-run; when agricultural credits increase by 1%, agricultural productivity will increase by 0.19 % ; that is, an increase in the amount of credits to agricultural sector leads to a remarkable increase in value-added agriculture, while FDI and government size both reduce agricultural productivity across countries. The findings of the pairwise causation test indicate that there exists bidirectional causal links among almost all variables, validating a feedback hypothesis revealed among agricultural productivity, credit to agriculture, FDI, government expenditures and inflation.

Productivity and Growth: The Role of Governance in India and Other Brics Economies

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Nexus between government agricultural expenditures and agricultural credit: The role of sustainable agricultural growth and sustainable agricultural income

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