Impact of Agricultural Subsidy on Agricultural Output

International Journal of Research and Innovation in Social Science (IJRISS) | Volume II, Issue IX, September 2018 | ISSN 2454–6186

Impact of Agricultural Subsidy on Agricultural Output

Michael Chukwunaekwu Nwafor

Department of Accounting and Finance, Godfrey Okoye University, Enugu, Nigeria.

Abstract: – This research work explored the impact of agricultural subsidy on agricultural output. A data span of a decade (2007 to 2016) was sourced and analysed using two-staged least squares regression method. Findings revealed however at a statistical significance that agricultural subsidy has significant impact on agricultural output. The need for government to put in place policies to kindle agricultural commercialization through cooperative system was recommended.

Keywords: Agricultural subsidy, Agricultural input, credit facilities, Agricultural output


There is a rapid proceeding of industrialization and consolidation in the food system. This is mostly evident, and of utmost social interest, in the agricultural production constituent of the food system. Provision of food for man and raw materials for industries (agro based) are the main importance of Agriculture. Agriculture involves all the activities of man geared towards better crop and animal yield. Agriculture has been a major employer of labour in many countries from time immemorial in addition to providing food for the populace and generation of revenue for the Government.
Before the discovery of oil in Nigeria, agriculture was the major revenue generator to the Nigerian economy but the oil boom of 1970s had an adverse effect on the agricultural sector and its capacity as it not only lost its place as the major revenue generator, it lost thelabour force that was supposed to keep on impelling the agricultural sector to greater heights. This however stunted the capacity of agricultural produce in Nigeria and even discouraging agricultural activity within the citizenry.

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