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Do agricultural commodity prices asymmetrically affect the performance of value-added agriculture? Evidence from Pakistan using a NARDL model

Author

Listed:
  • Umair Kashif

    (Jiangsu University)

  • Junguo Shi

    (Jiangsu University)

  • Snovia Naseem

    (Jiangsu University)

  • Muhammad Ayaz

    (Jiangsu University)

  • Rehan Sohail Butt

    (Jiangsu University)

  • Waris Ali Khan

    (Universiti Malaysia Sabah)

  • Mamdouh Abdulaziz Saleh Al-Faryan

    (University of Portsmouth)

Abstract

In the last few decades, rising prices of agricultural commodities have been an area of concern for most countries owing to high population growth, increased unemployment, and per capita food needs. The current study intends to examine the positive and negative shocks of agricultural product prices, credit disbursement, and the labor force’s impact on the agricultural growth of Pakistan. The nonlinear autoregressive distributed lag (NARDL) method was applied using secondary data sources from 1970 to 2018. The results revealed that positive and negative price shocks contribute positively to agriculture growth; however, positive price shock has a more stimulating effect than negative prices. Furthermore, credit disbursement and labor force significantly positively impact agricultural value added in the short and long run. Finally, the study’s findings have far-reaching consequences for policymakers dealing with Pakistan’s asymmetric relationship between agricultural credit disbursement, commodity prices, and agricultural growth.

Suggested Citation

  • Umair Kashif & Junguo Shi & Snovia Naseem & Muhammad Ayaz & Rehan Sohail Butt & Waris Ali Khan & Mamdouh Abdulaziz Saleh Al-Faryan, 2023. "Do agricultural commodity prices asymmetrically affect the performance of value-added agriculture? Evidence from Pakistan using a NARDL model," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-9, December.
    • Handle: RePEc:pal:palcom:v:10:y:2023:i:1:d:10.1057_s41599-023-01888-4
    DOI: 10.1057/s41599-023-01888-4
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