Effect of Research and Development on Agricultural Sector Growth in the East African Community (2000-2014)

Abstract

This study empirically examined the effect of research and development on agricultural sector growth in East African Community from the year 2000-2014. According to the endogenous growth theory, research and development leads to increase in the stock of knowledge which in turn has got spill over effects hence leads to economic growth. However, information on the effect of R&D on the agricultural sector in the EAC was lacking hence the study sought to bridge this knowledge gap. The objective of the study was to determine the effect of research and development on agricultural sector growth in the EAC. Historical design was employed while descriptive methods were used to show relevance of the information. Panel data analysis was used as it controls for country specific effects that makes the results gotten to be applicable to all the countries since the study involved five different countries. Random effects regression results showed that all explanatory variables had a positive relationship with the dependent variable significantly except the interaction of agricultural R&D and agricultural labour which had a negative relationship significantly and the recommendations are: That R&D to be allocated more funds; more research scientists and agricultural labourers to be employed, trained and motivated through better remuneration and good work environment; R&D based knowledge to be disseminated to the public through publications; firms to train agricultural labourers on how new technologies are being used and also to allocate them duties and responsibilities that match their skills and that agricultural capital costs be subsidised. The study has increased the stock of knowledge in addition to identifying other areas of future research. The results of this study may be of importance to agricultural policy makers in the government and in the private sectors. Future researchers may also gain from this study for comparison purposes. Future researchers can expand the period of a study similar to this and also study more countries; in addition, they should also focus on disaggregated R&D expenditures in other sectors. More studies should also be done on the effect of the interaction of agricultural R&D and agricultural capital on agricultural sector growth and also the effect of the interaction of agricultural R&D and agricultural labour on agricultural sector growth.