Ranking and relationship of agricultural credit with food security: A district level analysis

Sana Iftikhar, Hafiz Zahid Mahmood, Fatih Yildiz
2017 Cogent Food & Agriculture  
Agriculture sector is back bone of agrarian economies and it is the primary source of food in these economies like Pakistan. Current situation of Pakistan's economy highlighted that agriculture sector contributes the 19.8% share to GDP and provides 42.3% of the total work force. There is a lot of empirical work which focus on consistent expansion of agriculture output. Food production in agricultural economy require bundle of resources but credit is one of the factor which help in risk aversion
more » ... lp in risk aversion and risk Management. The one of the major problem faced by the farmers is the shortage of credit availability. Therefore, this study has been devised to observe the impact of institutional and non-institutional agricultural credit on the level of food security in the districts of Punjab province of Pakistan. In this regard multiple linear regression models are rendered to quantify the relationship between food security (i.e. Food Insecure Population, Food Availability, Food Access and Food Absorption) and Agricultural Credit (i.e. Overall Agricultural Credit, Institutional Agricultural Credit and Non-Institutional Agricultural Credit). The study find that Institutional Agricultural Credit is significantly helping in combating food insecurity while Non-Institutional Agricultural Credit shows unexpected results. Therefore it is strongly recommended to cates institutional credit to reduce food insecurity issues in the country. (Inayatullah et al., 2012) . Food availability and food absorption also have negative relationship with overall agricultural credit but food absorption has positive and significant effect. In case of Institutional agricultural credit, food security, food availability and food access are showing the expected outcomes. Non-Institutional agricultural credit is favorable for food availability and food absorption. This results support the study of (Rao, 2003) , in which he indicates that people are moving towards non-institutional agricultural credit rather than institutional agricultural credit. All of them are dependent on Agricultural sector while the food production reduces day by day and there is shortage of surplus in rice export. Although this study has produced very good results for policy makers but it is strongly suggested to future researchers to carry out such kind of study using all of the independent variables. The future researchers must incorporate other inefficiency variables being used in the agriculture sector to determine relationship between food security and agricultural credit relations etc.
doi:10.1080/23311932.2017.1333242 fatcat:yuotlj4ambf55oap72qpf3g7ae