The Role of Agriculture in the Nigerian Economy Essay example

8790 Words Sep 3rd, 2010 36 Pages
CHAPTER TWO
LITERATURE REVIEW

In this chapter of the research work, the review of related literature is presented under the following heading:

□ Role of Agriculture in an Economy

□ Importance of Agriculture

□ Analysis of Selected Indicators of Agricultural Growth

□ Agricultural Constraints

□ Institutional Reforms

□ Major agricultural policies in Nigeria from 1960-2005

□ Macro-economic variables affecting economic growth

□ Government expenditure

□ Investment

□ Foreign investment

□ The new Nigerian Agricultural Policy

2.0 The role of agriculture in an economy It is important to first define the term-Agriculture before talking about the role of agriculture in the economy.
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This roughly indicates the extent to which the agricultural sector absorbs the labour force in the country. However, World Bank Report (1970) puts it that the agricultural sector employed 71% of the total labour force in Nigeria in 1960 and by 1977; this had dropped to 56%. It rose to 68% in 1980, fell to 55% in 1985 and further fell to 53% in 1986 and 57% annually from 1989 to 1992. They however argued that the fall in the proportion of labour force engaged in agriculture is due to the structural changes in the economy where other sectors are assuming different dimensions and engaging more labour than they previously did. It is necessary to point out that given the importance of labour in agriculture of most African nations including Nigeria, and the poor labour absorptive capacity of their industrial sector, rapid outflow of labour from the agricultural sector has generated not only social but economic problems as well. A partial consequence of a high labour out flow from agriculture has been a decline of agricultural production in Nigeria in recent years. In his analysis, Ihimodu (1993) stated that “agriculture had often been described as the mainstay of the Nigerian economy, especially so before the oil boom of the 1970s”. Consequently, many roles were expected to be played by the sector in the process of development of

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