Economic perspectives of cotton crop in Pakistan: A time series analysis (1970–2015) (Part 1)

The basic objective of this paper was to investigate and enumerate the relationship between cotton crop output, agricultural gross domestic product (AGDP), area under cotton crop and fertilizer consumption in Pakistan over the period 1970–2015. Time series data were used in this study from 1970 to 2015, and these data were collected from Economic Survey of Pakistan and Pakistan Bureau of Statistics annual reports. Cotton crop data were analyzed using Augmented Dickey Fuller (ADF) test, co-integration test and Ordinary Least Square (OLS) method. The results of co-integration test show that there exists a long-term relationship between output of cotton crop, area under cotton crop, fertilizer consumption and agricultural gross domestic product of Pakistan. Regression analysis results showed that output of cotton and fertilizer consumption has positive relationship with agricultural gross domestic product of Pakistan while area under cotton crop has a negative relationship with agricultural gross domestic product (AGDP) of Pakistan. Keywords: Agricultural GDP, Output of cotton, Fertilizer consumption, Ordinary Least Square (OLS), Agrochemicals and synthetic chemical