Relationship between government spending and the contribution of agriculture to GDP in Uganda

Abstract

This study focused on the relationship between government spending and the contribution of agriculture to GDP in Uganda. The study was guided by objectives which included finding out the government expenditure on the agricultural sector, finding out the contribution of agricultural sector on GDP and finding out the relationship between government spending on agriculture and GDP. The study adopted quantitative approaches to provide a more complete and comprehensive picture of the issues under discussion. The study focused on Agricultural sector in Uganda information and was collected from MAAIF, UBOS, and Bank of Uganda. A Multiple Regression Analysis (MRA), was later done to establish how the independent variables (Government Expenditure on Agriculture), predicted dependent variable (GDP). Findings revealed that agricultural production and its contributions to GDP had a great influence and thus portrayed significant contributions to Gross Domestic Product. It was also concluded that regarding other factors such as service sector and Industry affected Gross Domestic Product (GDP). Hence, the researcher concluded that agricultural production, industry and service sector are predictors Gross Domestic Product. From the analysis of three predictors of factors, it was generally concluded that these factors influence Gross Domestic Product (GDP) by close to 86.6 percent. It was recommended that government should increase spending on basic sector to enhance economic growth of sub-Saharan African countries. Second, the government should increase the expenditure on research and development of the sector.