IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF APPLIED SCIENCES AND MATHEMATICAL THEORY (IJASMT )

E- ISSN 2489-009X
P- ISSN 2695-1908
VOL. 9 NO. 1 2023
DOI: https://doi.org/10.56201/ijasmt.v9.no1.2023.pg1.13

---

Investigating Regression Parameters Stability of Agricultural and Health Sector on Growth Domestic Product of Nigeria, Using Difference and Return Series

OKECHUKU Tochineke, Orumie Ukamaka Cynthia, BIU, Emmanuel Oyinebifun

---

Abstract

The international market's dropping in oil price highlights the necessity for Nigeria's economy to be diversified in order to grow the non-oil sector, of which agriculture and health are subsectors. A large portion of the population of Nigeria earns their living through agriculture, which is well-reported in the literature. In this study, the impact of Nigeria's agriculture and health expenditures on the country's GDP is examined from 1999 to 2021. The CBN statistical bulletin was used to extract yearly data for agriculture and GDP. The Nigerian Real Gross Domestic Product was regressed on health and agricultural expenditure from 1999 to 2021. Four regression models were employed in this study (First difference, First difference of the Logarithm of the series, Return series, Return of the Logarithm of the series). Then, each individual series fluctuation were examined to determine the trend component in the series. The time plots of the data revealed the presence of upward trend in the series and suggestion of non- stationrity. The KPSS and Augmented Dickey-Fuller test conducted on the series indicates that actual and first difference series were non-stationary at the critical values of 5%, while the return and return logarithm series were stationary at 5%. Then, the ideal model was selected based on Information Criteria: AIC and SQC. The Return Logarithm series Regression Model was identified as the robust (best) model to examine the relationship between health and agricultural expenditure on GDP, when the transformed series are non-negative which no spurious regression was produced. The identified model revealed that 1% change in agricultural expenditure causes about 71.6% change in GDP and 1% change in health expenditure causes about 27.7% change in GDP. Hence, this result suggested that return series is the better method of making the series to be stationary before fitting regression model when the transformed series are non-negative.

keywords:

regression models, Logarithm of the series, non-stationrity, Return of the Logarithm

---

References:

Achienewhu St & Opigo H. (2013). Discomoon of the Nigerian Economy Maximizing
www.habbieslaw.wordpress.com 01 24

Adenomon M.O. & Oyejota I. (2014). Impact of Amculture and Industrialization on GDP in
Nigeria: FVilence ban VAR and SVAR Models. Int. J. Analysis and Application 140-
7420

Adewole, A. O. (2012). Effect of Population on Economic Development in Nigeria: A
Quantitative Assessment. International Journal of Physical and Social Sciences, 2(5): 1-
14.

Aminu U & Anono AZ, (2012). An Empirical Analysis of the Contribution of Agriculture and
Petroleum Sector to the Growth and Develoment of the Nigerian Economy from 1960-
2010. Int. J. Soc. Sci. & Edu, 2:758-769.

Anacbonam W. (2013). Agricultural Sustainability: Hope for Nigeria's Economy? Newswatch
Times, June 22, 2014. Awe AA & Ajayi SO, Diversification of Nigerian Revenue Base
for Economic.

Anacbonam W. (2016). Modeling the Relationship between Agricultural Sector and GDP in
Nigeria: Evidence from Bound Testing Approach and Johansen Co-integration Test,
Annual conference proceedings of Nigeria Statistical Association Abuja, Nigeria. Pages:
140-152.

Chris, B. (2008). Introductory econometrics for finance (3 rd Edition). Cambridge University
Press. Central Bank of Nigeria (www.cbn.gov.ng).
Doguwa SI & Alade S. O. (2015). On Time Series Modeling of Nigeria's External Reserves.

CBN Journal of Applied Statistics. 6(1a):1-28.
Green, W. H. (2012). Econometric Analysis (7th ed). Upper Saddle River, NJ: Pearson Prentice
Hall.

Jhin gan, M. L. (2005). The Economic Development and Planning 38th Edition. Vrinda
Publications (P) Limited Delhi, India. Mason, A. (2001). Population Change and
Economic Development in East Asia. Challenges Met, Opportunities Seized. Stanford
University Press, Stanford.

DOWNLOAD PDF

---

Back