Which Sector Should Lead In Ethiopia? Industry or Agriculture?

Course ID
Ethiopian Economics Association (EEA)
Daniel Gulti

Following The Unbalanced Growth Theory By Hirschman Our Country Has Been Following Agricultural Development Lead Industrialization (Adli) As A Development Strategy To Transform The Economy And Bring Sustainable Development. But There Are Some Politicians And Economists In The Country Who Question The Potential Of Ethiopian Agricultural Sector To Transform The Economy And Bring Industrialization. So They Opt To Base The Development Strategy On Industry Rather Than Agriculture.
Hence, This Paper Tries To Address The Question “Which Sector Has To Lead In Ethiopia?”
To Answer This Question I Have Used The Social Accounting Matrix (Sam) And Johansen Cointegration Analysis. The Social Accounting Matrix Is Used To Measure The Backward And Forward Linkages Of The Sectors, While Johansen Cointegration Analysis Finds Out The Direction Of Causality.
Social Accounting Matrix (Sam) Is General But Static, While Johansen Cointegration Analysis Is Partial But Dynamic. According To The Social Accounting Matrix The Agricultural Sector Has High Back Ward And Forward Linkage With The Rest Of The Sectors. But Johansen Cointegration Analysis Tells Us That Agricultural Sector Is Weakly Endogenous While The Industrial Sector Is Weakly Exogenous. Hence, Causality Runs From Industry To Agriculture Not The Other Way Round

Corporate Author:Getnet Alemu & Worku Gebeyehu (Editor) & Ethiopian Economic Association/Ethiopian Economic Policy Research Institute
Publisher:Ethiopian Economic Association (EEA)
Primary Descriptors:Cointegration

Secondary Descriptor:Social Accounting Matrix

Geographic Descriptors:Ethiopia
Cataloge Date:02/27/2013
Broad Subject heading:Agricultural Development Led Industrialization
Call Number:330.963 PRO 2012
Serial Key Title:Proceedings of the Ninth International Conference on the Ethiopian Economy
Publication catagory:International Conference
Content type:EEA Publication
Publication date:2013-06-27 23:12:00
Forum or Discussion date:2013-02-27 15:57:55
Place of publication:Addis Ababa, Ethiopia
Type of material:Book
Current frequency:Annualy
Author: Daniel Gulti

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