Dynamic Interactions among Road Transport Infrastructural Development, Agricultural Growth and Poverty Level in Nigeria

Samuel O. Oladipo; O. Ayegbusi

Samuel O. Oladipo
O. Ayegbusi

Keywords: Economic growth, road transport, poverty level, cointegration, VAR

Abstract

The study investigated the dynamic interaction among road transport infrastructural development, agricultural growth and poverty level in Nigeria. It examined the nature and direction of causality among road transport infrastructural development, agricultural output and poverty level in Nigeria. This was with the view to providing empirical evidence on the linkages among road transport infrastructure, agricultural output and poverty level. The data on road transport infrastructural development, agricultural growth and real consumption expenditure per capita used in proxy poverty level were sourced from the statistical bulletins of the Central Bank of Nigeria and the National Bureau of Statistics, Abuja. Vector Error Correction Model (VECM) was used to determine the interaction effects among the three variables, while the pair-wise granger causality test was used to determine the direction of causality among variables. The result showed that one percent innovation in both road transport infrastructural development and real consumption expenditure per capita brought about a positive response by agricultural output; and although a shock to road infrastructure produced a negative response by real consumption expenditure per capita, it became positive over time. Moreover, there was increase in positive response of real consumption expenditure per capita as a measure of poverty due to an innovation in agricultural output. This was also complimented by the causality result which revealed that both agricultural output and road transport infrastructural development granger-cause poverty reduction through real consumption expenditure per capita in Nigeria.

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