Does Agriculture have an Impact on Economic Growth? Empirical Evidence from the Gambia

Abstract

The present study aims to answer the question, ‘Does agriculture have an impact on economic growth in the Gambia? The secondary source of data covering the time series period 1980 to 2017 is employed. It opines that agriculture is one of the variable techniques of economic growth in developing countries like the Gambia. The methods of analysis used were Error correction model and Auto regressive distributed lag model (ARDL) to estimate the economic growth. The study found a significant positive effect of agriculture on economic growth in both the short- run and long-run, reaffirming the sector’s importance in the economy. The impact of agriculture to economic growth is further affirmed from a causality test which showed that agriculture growth Granger- causes GDP growth and GDP growth also Granger causes agriculture growth. The study concludes that agriculture have a positive impact on economic growth. I recommend that, the government and policy makers should embark on diversification and enhance more allocation in terms of budgeting and policy changes in the agricultural sector. Key Words: Economic Growth, Gross Domestic Product and Agriculture