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The structures of production, final demand and agricultural output: a Macro Multipliers analysis of the Nigerian economy

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Abstract

This study made an effort to build the Social Accounting Matrix for the Nigerian economy, which describes the income circular flow through the integration of the production with the income flows, including both the generation and the distribution of value added and the creation of final demand. Such database allows developing an extended input–output model and a Macro Multipliers analysis based on the technique of singular value decomposition. First, the analysis identifies the key sectors amongst the agricultural sectors that have significant interactions with the other commodities of the economy. Furthermore, the Macro Multipliers analysis is conducted in order to identify the interactions between policy objective (total output) and policy control (final demand) at a multi-sectoral level.

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Notes

  1. WDI World Bank.

  2. FAO report on Nigerian economy. Available at: http://www.fao.org/nigeria/fao-in-nigeria/nigeria-at-a-glance/en/.

  3. Nigerian Agricultural Transformation Agenda, Federal Ministry of Agriculture and Rural Development http://www.fmard.gov.ng/.

  4. Professor Chinedum Nwajiuba, Nigeria’s Agriculture and Food Security Challenges. Available at: https://us.boell.org/sites/default/files/downloads/4_Green_Deal_Nigeria_AGRICULTURE.pdf.

  5. Forssell (1988) on Finnish economy for the period 1960–1970, Urata (1988) on Soviet economy between 1959 and 972, Skolka (1989) on Austrian economy, Lee (1990) on US economy for 192-82, Khan (1991) on Pakistan’s economy and Matallah and Proops (1992) on Algerian economy.

  6. To mention a few, a comparative study by Chenery and Watanabe (1958) concludes the uniformity in the structure of production of Finland, Italy, Japan, and the USA. Whilst, several other comparative studies include the work of Simpson and Tusukui (1965), Robinson and Markandya (1974), Kubo et al. (1986a, b) and Soofi (1992). A condensed list of the studies on structure of production and linkages analyses is presented up to now representing different economies and different approaches. To name a few, Hoen (2002) used cluster-based methodology to identify the inter-industry linkages. While Cai and Leung (2004) used archival approach to present refined backward and forward linkage indices using practical exercise on Hawaii’s agricultural sectors. On the other hand, Peters and Herwich (2006) conducted the structural path analysis on Norwegian economy to identify the linkages between the global production networks and domestic production and consumption. Moreover, some other prominent studies include a work by Leung and Secrieru (2012) on Canadian economy, Harada (2015) on Japanese economy, and Chang and Lahr (2016) on Chinese economy.

  7. IFPRI developed SAMs for Zimbabwe (year 1991), Morocco (1994), Mozambique (1994, 1995), Egypt (1997), South Africa (1993, 1998, 1999), Zambia (1995, 2001) and Kenya (2001).

  8. These include 24 categories of Households, 1 category of Firms and 1 category of Government.

  9. See Appendix A.

  10. The hired labour in the general household survey refers to the labor employed by a person who works for someone not a member of household, for example; an enterprise, company, the government or any other individual. Whereas the family labour means the labour employed by the person who works on a farm owned or rented by a member of household. On the other hand, the self-employed refers to the labor employed by the person who works on own account or in a business enterprise belonging to household or someone in household such as trader, shop-keeper, barber, dressmaker, carpenter or taxi driver.

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Author information

Authors and Affiliations

  1. Jazan University, Jizan, Kingdom of Saudi Arabia

    Irfan Ahmed

  2. University of Macerata, Macerata, Italy

    Claudio Socci, Francesca Severini & Rosita Pretaroli

  3. Ministry of Planning, Development and Reform, Islamabad, Pakistan

    Qaiser Rafique Yasser

Authors
  1. Irfan Ahmed
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  2. Claudio Socci
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  3. Francesca Severini
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  4. Qaiser Rafique Yasser
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  5. Rosita Pretaroli
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Corresponding author

Correspondence to Irfan Ahmed.

Appendices

Appendix A: Commodities and activities classification

See Table 6.

Table 6 Commodities and activities in the Nigeria SAM for 2010
Full size table

Appendix B

See Tables 7 and 8.

Table 7 Direct and indirect effects of a unitary demand shock on total output by commodity
Full size table
Table 8 Direct and indirect effects of final demand shocks with the structure 1 on total output by commodity
Full size table

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Ahmed, I., Socci, C., Severini, F. et al. The structures of production, final demand and agricultural output: a Macro Multipliers analysis of the Nigerian economy. Econ Polit 35, 691–739 (2018). https://doi.org/10.1007/s40888-018-0115-5

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