Determinants of sheep production in Libya

Abstract

The study targeted the determinants of variables affecting sheep production in Libya and used time series over the period 1984 to 2023 to estimate the ARDL model. The study findings revealed that the independent variables X1, barley production, and X2, barley production area, were stationary at the level. While the dependent variable, Y sheep production, rainfall X3, and X4 pasture area were stationary in the first difference. The results in the short run indicate that previous effects of barley production that are X1 (-1), X1 (-2), X1 (-3), and X1 (-4) have a negative and significant effect on the dependent variable, sheep production. Moreover, the previous effects of the X2 barley production area variable that are X2 (-1), X2 (-2), and X2 (-3) have a positive and significant effect on the dependent variable, sheep production. Further to that, the previous effect of the X3, which was X3(-1), has a positive and significant effect on the dependent variable. More than this, the previous effects of X4 that were X4 (-1) and X4 (-2) have a positive and significant effect on the dependent variable. Regarding the long-run case, the findings demonstrate that variable X1 had a positive and significant effect at 5%. This result reflects an independent variable increase by one unit that leads to an increase of the dependent variable by 2.647. As for other variables, they were negative and significant at 10%, 5%, and 1%, respectively. This result means that increased variables X2, X3, and X4 with one unit led to a decline in the dependent variable by 2.08, 0.19, and 3.5, respectively in long-run. As for the error correction term ECT (-1), whose value was 1.827, it refers to speeding the system to equilibrium by 182.7% of the equilibrium, which is corrected during the period.