Contribution of agriculture subsectors on economic growth in Bangladesh: An application of the ARDL method

Md Shajedur Rahaman (), Mohammad Chhiddikur Rahman, Md Abdur Rouf Sarkar and Mohammad Ariful Islam ()
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Md Shajedur Rahaman: Agricultural Economics Division, Bangladesh Rice Research Institute
Mohammad Ariful Islam: Agricultural Economics Division, Bangladesh Rice Research Institute, Bangladesh

Economics Bulletin, 2023, vol. 43, issue 1, 245 - 264

Abstract: As the largest sector in Bangladesh, agriculture and its subsectors have always played a dominant role in accelerating economic growth. The current research was performed to assess the agriculture subsector's contribution to Bangladesh's economic development. To evaluate the effect of agricultural subsectors on economic growth, this study employed the Autoregressive Distributed Lag (ARDL) method and Error Correction Model (ECM)with the historical data collected from the Bangladesh Bureau of Statistics (BBS) and the World Bank (WB). The results of the ARDL bound test confirm that the agricultural subsectors and economic growth have a strong association in the long run. The positive and significant coefficients of the crop, livestock, and fisheries subsectors reveal that these variables have an impact on the economic growth of Bangladesh in both the short and long-run. The findings also showed that the crop subsector has a bidirectional causal connection with economic growth. In addition, the pairs ‘economic growth and livestock subsector', and ‘economic growth and forestry subsector' showed a unidirectional relationship. Therefore, this study suggests that the development of agricultural subsectors is vital to the economic development of Bangladesh. The agricultural subsectors intensively require more attention and investment from public and private sources in order to steer more economic expansion.

Keywords: Agriculture subsectors; ARDL; ECM; Economic growth; Granger Causality; Bangladesh (search for similar items in EconPapers)
JEL-codes: O4 Q1 (search for similar items in EconPapers)
Date: 2023-03-30
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