AN ECONOMETRIC STATISTICAL ANALYSIS OF THE IMPACT OF THE CAUSAL RELATIONSHIP BETWEEN AGRICULTURAL INVESTMENT AND THE VALUE OF AGRICULTURAL DOMESTIC PRODUCT IN EGYPT

The objective of this research is to assess the impact of agriculture investment value and agricultural employment on GDP value between 1990 and 2021. To achieve this purpose, a vector autoregressive model (VECM) was designed as an error correction model. Additionally, the study conducted a time series stationarity test on these variables using the modified Dickey-Fuller (ADF) unit root analysis, and the results confirmed that the study variables were not stationary and stable at the level but were all stable and stationary after accounting for the first difference. Using the Johansen Test cointegration model, the results showed the existence of a causal relationship in the short and long term, as well as the presence of at least one vector illustrating the cointegration connection among the explanatory variables. The Pairwise Granger Causality test reveals a two-way reciprocal causal relationship between the amount of public and private agricultural investment within the agricultural sector. Among the most significant recommendations of the research is that agricultural development plans should focus on public investments, like greenhouse projects that employ state-of-the-art production technology and projects to construct field irrigation systems on old lands.