The Productivity of Indian Foodgrain production
In agricultural growth the measure of agricultural productivity is of very much important in which productivity of foodgrain dominates because it is the central part of the supply side economics.From 1970-71 to 2009-10, India’s foodgrain productivity had increased very slowly at the rate of 2.32% per annum which played a great role in creating food inflation in India.The estimated equation is given below,
Log(x) = 6.683+0.0232t
R2= 0.948 , DW= 1.58 , F= 692.09* , * = significant at 5% level
Where x= productivity of foodgrain kg/hectres.the t values of constant and trend are significant.
In the figure the estimated line of foodgrain productivity is rising upward but the actual productivity line is shown volatile and was found autocorrelation problem.
The foodgrain productivity showed stationary during the study period and has unit root .The estimated ARIMA model is shown below,
(0.415) (125.03)* (-45.623)*
R2= 0.939 , F= 279.18* , DW= 2.03
Inverted AR root =1 and MA root = 0.96
Since t value of AR and MA are significant and F is significant ,so stationarity of the model is confirmed.
Even it has no ARCH error because heteroscedasticity ARCH test assures that nR2= 3.1867 which is significant whose F = 3.29 which is also significant. The conditional standard deviation is seen in the figure which is volatile.
Thus, in conclusion we can say that to reduce food inflation the growth of India’s foodgrain productivity is very low during 1970-71 to 2009-10 which must be enhanced in due course.