The impact of agricultural production and remittance inflows on economic growth in Bangladesh using ARDL technique

Both remittances and agricultural production have a vigorous role in the development of an economy. The main purpose of this study is to find out the contribution of these sectors on growth and development of the country. Using the augmented Dickey–Fuller test, it has been shown that the variables are stationary at mixed order means that some of the variables are stationary at the first difference and some of the variables are at the level that’s why we have been used the auto-regressive distributed lag (ARDL) technique for investigating the linkage of the variables using time series data from 1990 to 2019. The study revealed that the agriculture has a positive impact on GDP in the long run and short run. And the remittances have a positive impact in the long run through it has a negative impact on GDP in the short run. The elasticity of agriculture is 1.00 in the long run and 0.33 in the short run. Again, the elasticity of remittance is − 0.16 in the short run and the elasticity of remittances is 0.25 in long run. The coefficient value of the speed of adjustment (ECT) is − 0.33 which is significant at the 5% level. In the preliminary phases of the economic development of a developing country, the agriculture and remittance sectors are both considered as two essential ingredients. This study contributes to find out the contribution of agriculture and remittance on economic growth of the country using ARDL model which is clearly different from rest of the literatures.