Research on Factors Influencing the Grain Production in Pakistan: An ARDL Approach

Abstract

Ensuring food security is an important for economic development and social stability. Pakistan’s economy is primarily dominated by agriculture sector. This paper employed the ARDL approach to cointegration in order to investigate the short and long-run determinants of grain crops productivity in Pakistan over the period 1978 to 2016. The results of ARDL bound test showed that the value of computed F-statistic exceeded the upper bound value, which means the equations were statistically significant at 5%. Further, empirical results of long-run and short-run revealed that area under grain crops, improved seed, fertilizer, and availability of water have a positive and significant effect on grain crops production in Pakistan. The estimated equation remains stable over the period of 1978 to 2016 as shown by stability tests. Currently, in Pakistan, small-scale farmers are unable to purchase farm machineries such as a tractor, tube -well and other inputs due to high prices. Therefore our study recommended that government should give subsidy to farmers on main agricultural inputs for improvement of grain crops production.