Agriculture and Economic Growth in Syria: Evidence on the Dynamic Interrelationship from ARDL and Granger Causality Analysis

Naji AlFraj

doi:10.56093/aaz.v65i4.173708

Authors

Naji AlFraj Department of Agricultural Economics and Extension, Faculty of Agriculture, Al Furat University, Deir-ez-Zor, Syrian Arab Republic https://orcid.org/0000-0002-4948-3475

https://doi.org/10.56093/aaz.v65i4.173708

Keywords:

Economic development, Agriculture-led growth, Gross domestic product, Agricultural value added, Reconstruction, Syria.

Abstract

The agricultural sector is one of Syria’s vital productive sectors and is closely interconnected with national
economic activity. This study examines the short-run and long-run relationship between agricultural value added (AVA),
carbon dioxide emissions (CO2), gross fixed capital formation (GCF), population (POP), the Syrian crisis (CRI), and gross
domestic product (GDP) in Syria. GDP is used as the dependent variable and as a measure of aggregate economic output rather than as a direct measure of the GDP growth rate. Annual data for 1970-2021 are analyzed using the Autoregressive
Distributed Lag (ARDL) approach and the Granger causality framework. The bounds test indicates a statistically significant
joint long-run levels relationship among the model variables. The derived long-run coefficients are approximately 1.202 for AVA, 0.921 for POP, −1.391 for CO2, 0.351 for GCF, and −1.398 for the crisis dummy. These coefficients are derived from
the estimated levels equation and should be interpreted as conditional long-run associations; their statistical significance
requires formal long-run restriction/Wald tests rather than inference from the individual levels coefficients. In the short
run, AVA has a positive and statistically significant association with GDP, while GCF is positive at the 10% level. Bidirectional Granger causality is found between AVA and GDP, indicating a feedback relationship rather than a purely agriculture-led direction of causality. The strong AVA–GDP association also requires particular caution because AVA is an accounting component of GDP and both variables are measured in current US dollars. Consequently, part of the observed association may reflect national-accounting construction and common nominal valuation effects, in addition to genuine economic interdependence. The findings therefore indicate a close and mutually reinforcing relationship between agriculture and aggregate economic output in Syria, while the evidence does not justify characterizing agriculture as the sole or unambiguously leading source of economic growth.

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