Population Growth and Agricultural Policy

University essay from Lunds universitet/Nationalekonomiska institutionen

Abstract: The growing world population creates increasing pressure on the economic growth and the environment. Since the times of Malthus and Smith there has been studies linking population growth and agriculture. We have looked further into the subject; we studied the relationship between agricultural subsidy policies and population growth in an agricultural dependent society. The theoretical model predicted an increased fertility rate and a decreased mortality rate as an effect of an increase in agricultural subsidies e.g. subsidized fertilizers. To examine the significance of our theories we performed an econometric study of Nigeria’s different regions during the years 2001-2005. Nigeria has a history of subsidizing fertilizer use and had during the time period a subsidy of 25 percent of landed cost. We found that agricultural policies likely decrease mortality rates in the regions studied. We did not find any significance on an increased fertility. The main objective with the agricultural policy was to increase agricultural production, but as a secondary effect it obtained population growth by decreasing mortality rates. A decreasing mortality is often an indication of the increased wealth of the population. Subsidizing fertilizers in a country such as Nigeria is from this point of view positive for the well-being of its population.

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