Determinants of Agricultural Productivity in the East African Community

ABSTRACT This article examines the determinants of agricultural productivity in the East African Community for the period 2000 to 2020. Panel data estimation methods were applied in the study. The long run relationship between the variables was estimated using fully modified ordinary least square (FMOLS) and dynamic ordinary least square (DOLS). The causality between variables was analyzed using the Dumitrescu and Hurlin (2012) panel Granger causality test. The empirical findings indicated that there was a long-run relationship between agricultural productivity and gross capital formation in agriculture, rainfall, climate change, government efficiency, and corruption control based on the FMOLS and DOLS estimation results. The panel Granger causality analysis indicated that there was unidirectional causality between agricultural productivity and arable land, rainfall, climate change, and corruption control. However, the causal relationship between agricultural productivity and agricultural labor was found to be bidirectional. There was also evidence of bidirectional causality between agricultural productivity and government efficiency. However, agricultural productivity did not have any causal relationship with agricultural gross capital formation and permanent cropland. The study recommended the strengthening of agricultural sector institutions and the formulation of policies to mitigate the effects of climate change and promote agricultural sector resilience against shocks.