The Impact of Energy Consumption on Agriculture Production in Pakistan

Energy is the key element for economic development as it offers major services for continuing the economic activity, and thus, improves the human life. However, the empirical evidence regarding the influence of energy consumption on agricultural production in the context of developing economies is limited in the current empirical literature. Therefore, this research fulfills this gap by empirically investigating the impact of energy consumption on agriculture Production for Pakistan by collecting time series data based on annual observation from (1980-2020). For estimation purpose, this study employed the Auto Regressive Distributed Lag approach to analyze the existence of long-term connection between energy consumption and agriculture production. The study findings show that the long-term co-integration relationship exist between energy consumption of electricity, oil, and agricultural production. The energy consumption of electricity and oil has a significant and direct impact on agricultural production. Based on empirical results, this study recommends policy makers, Pakistan government to design policies regarding the availability of cheaper electricity to small farmers in the rural areas. For this purpose, advance techniques are needed. Therefore, government should allocate more funds for the innovations in the energy sector. Keywords: Energy consumption, Agricultural Production, Energy consumption of oil and electricity, Autoregressive Distributed Lag approach.