Economic Growth and Government Subventions for Agriculture Sector in Algeria: An ARDL Model

Abstract

The article analyzes the impact of government support of the agricultural sector on the economic growth in Algeria. The study is based on cointegration relation and error correction model according to Autoregressive Distributed Lag (ARDL) model developed by Pesaran and al (2001). The results indicated that the support of agriculture production and producers has a positive impact on the agricultural growth, while it has a negative impact on the economic growth in the long term. On the other side, the total agricultural support regardless of its relationship with production and producers has a positive impact on agricultural production growth and economic growth in the long term. Finally, the total support of the agricultural sector is more important than individual support for agricultural producers.