Agricultural Transformation and Rural Development in Pakistan A Multivariate Johansen Co-integration Analysis

Abstract

The present study has empirically examined the agricultural transformation and rural development which is relevant to Pakistan. It is two side research one side explains the agricultural transformation and the other side explains the development of rural areas of Pakistan. The time series data is used from 2000 to 2021 and employ (ADF) Augmented dickey-fuller test, Johansen Co-Integration technique, Granger causality and diagnostic tests like LM test for cereal correlation, white test for Heteroscedasticity and CUSUM test. The agricultural value added negatively affects the land under cereal production, wage and salaried workers and the rural population. Because over temperature affects cereal production which affects the wages of workers and causes unemployment in rural populations. The crop production has positively affected the wage and salaried workers, employment in agriculture and food exports because rainfall turned out the barren land into green land which lead to enhance in employment causing to increase in wages and exports of foods. A huge amount of barren land reduces the production of cereal foods and grain and the availability of green land cause to increase in this production which leads to an increase in the exports of food. The facility of electricity increases the effort, efficiency and quality of workers they take interest in their work while if they are illiterate they remain unaware of new technology and the rural areas could not develop without educated people. Cereal production could be enhanced through electricity in rural areas while if the huge amount of land is barren it may reduce the production of food grains and rural areas remain underdeveloped. We need to enhance facilities to decrease the negative and insignificant effects in rural areas and Agriculture.