EXCHANGE RATE VOLATILITY AND AGRICULTURAL EXPORT IN A SMALL OPEN ECONOMY

Abstract

The concern of this paper is to examine the impact of real exchange rate
volatility on Agricultural product export flow in Nigeria for the period 1986
-2018. ARCH and GARCH Models were used to measure current volatility
of exchange rate relationship and Johansen co-integration test with vector
error correction model (VECM) was used to investigate the impact of
exchange rate volatility on agricultural export. The findings suggest that,
there exist statistically significant relationship between agricultural exports
and exchange rate volatility in Nigeria. The study recommends the
combination of monetary and fiscal policy to address the impact of
exchange rate volatility instead of sole concentration on monetary policy
alone.