“This study estimated price and non-price supply response coefficients for nine individual crops, sub-sectoral aggregates and commodity exports using the two-stage least squares (TSLS) and seemingly unrelated regression method (SURM) as tools for evaluating the effects of sub-sectoral aggregates on Nigerian agriculture. The estimates confirm two results in the supply response literature: (1) short-run price elasticities of individual crops are smaller than the long-run elasticities and (2) commodity sub-sectoral aggregates do not respond significantly to prices as individual crops. The results also show that the responses of food crops are sensitive to Nigeria’s agro-climate and the traditional cropping patterns of Nigerian farmers, who are mainly smallholders. Moreover, individual crops and sub-sectoral aggregates do not respond significantly to capital expenditure on agriculture (CEA), possibly because of action lags, weak choice of agricultural infrastructures and corruption.”
