The Effect of Technology on Agricultural production in Awi Zone, Ethiopia: ECM Approach
Various literatures on Green Revolution argue that use of improved seeds and fertilizers have the capacity to reduce the extent of poverty by increasing agricultural productivity. This paper investigated the effect of technology on agricultural production in Awi Zone, Ethiopia. The study has employed co-integration and error correction models by using time series data from 1997/98 to 2016/17 which was retrieved from Central Statistical Agency of Ethiopia. The existence of long run interaction among variables was confirmed by Engle-granger two step cointegration procedures. The results reveal that use of fertilizer affects agricultural production positively and significantly both in the long-run and in the short-run. On the other hand, the impact of improved seeds was found to be insignificant in the long run but affects agricultural production in the short run. While human capital is obtained to affect agricultural output positively and significantly in the long run, its short run effect was insignificant. The speed of adjustment towards the long-run equilibrium is estimated to be 32% per year.
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