The Impact of Government Expenditure on Infrastructure in Nigeria: A Co-integration & Error Correction Specification

This paper attempts to investigate the  impact of Government expenditure on infrastructure in Nigeria, using the cointegration and error correction Specifications. The result of the error correction mechanism (ECM) indicates a feedback of about 99. 38 percent of   previous year’s disequilibrium from long-run elasticity of rate of urbanization, openness, government revenue, external reserves, population density and type of government. The results of the Chow test revealed that public expenditure on infrastructure were stable and did not change over time as evidenced by F* value of 1.8214 against F-critical value of 2.580 at the 5% level during the period. Keywords: Government Expenditure, Economic Growth, External Reserve, Co-integration, Error Correction Mechanism, Infrastructure, Public Good

Estimating farmers’ willingness to pay for weather index-based crop insurance uptake in West Africa: Insight from a pilot initiative in Southwestern Burkina Faso

© 2018, The Author(s). Weather index-based crop insurance is increasingly becoming important as a risk mitigation strategy that farmers may use to mitigate adverse climate shocks and natural disasters encountered during farming. While Europe, North America, and Asia account for 20.1%, 55%, and 19.5% of the total agricultural insurance premium worldwide, respectively, Africa accounts for only 0.5% of the world insurance industry. One of the key reasons advanced against the low index insurance participation rate in Africa is the failure to involve farm households at the initial conceptualization and design of pilot initiatives. Therefore, the main purpose of this paper is to design an improved participatory methodology that could help elicit information on the value placed by farm households in Southwestern Burkina Faso on a new weather index-based crop insurance management initiative. A key concept in the improved participatory methodology is that of the willingness to pay (WTP) of farm households for the scheme. Knowledge of the maximum amount that farmers are willing to pay for the scheme can help insurance policy providers and public policy makers to design and put in place measures that sustain index insurance schemes in a developing country context and improve welfare among participating farmers

A Ricardian valuation of the impact of climate change on Nigerian cocoa production: insight for adaptation policy

Purpose The purpose of this study is to examine the relative importance of climate normals (average long-term temperature and precipitation) in explaining net farm revenue per hectare (NRh) for supplementary irrigated and rainfed cocoa farms in Nigeria. Design/methodology/approach NRh was estimated for 280 cocoa farmers sampled across seven Nigerian states. It was regressed on climate, household socio-economic characteristics and other control variables by using a Ricardian analytical framework. Marginal calculations were used to isolate the effects of climate change (CC) on cocoa farm revenues under supplementary irrigated and rainfed conditions. Future impacts of CC were simulated using Six CORDEX regional climate model (RCM) ensemble between 2036-2065 and 2071-2100. Findings Results indicate high sensitivity of NRh to Nigerian climate normals depending on whether farms use supplementary irrigation. Average annual temperature increases and precipitation decreases are associated with NRh losses for rainfed farms and gains for supplementary irrigated cocoa farms. Projections of future CC impacts suggest a wide range of NRh outcomes on supplementary irrigated and rainfed farm revenues, demonstrating the importance of irrigation as an effective adaptation strategy in Nigeria. Originality/value This paper uses novel data sets for simulating future CC impacts on land values in Nigeria. CORDEX data constitute the most comprehensive RCMs projections available for Africa