Abstract:
This study investigates the asymmetric effects of economic policy uncertainty (EPU) on
food security in Nigeria, utilizing annual time series data from 1970 to 2021. The study used descriptive
statistics, unit root tests, the nonlinear autoregressive distributed lag (NARDL) model and its
associated Bounds tests to analyze the data. The analysis reveals that adult population, environmental
degradation, exchange rate uncertainty (EXRU), financial deepening, food security (FS), government
expenditure in agriculture uncertainty (GEAU), inflation, and interest rate uncertainty (INRU) exhibit
positive mean values over the period, with varying degrees of volatility. Cointegration tests indicate
a long-term relationship between EPU variables (GEAU, INRU, and EXRU) and food security. The
study finds that cumulative positive and negative EPU variables have significant effects on food
security in the short run. Specifically, negative GEAU, positive INRU, positive and negative EXRU
have significant effects in the short run. In the long run, negative GEAU, positive and negative EXRU
have significant effects on food security. Additionally, the research highlights asymmetric effects,
showing that the influence of GEAU and EXRU on food security differs in the short- and long-run.
The study underscores the importance of increased government expenditure on agriculture, control
of exchange rate and interest rate uncertainty, and the reduction in economic policy uncertainty
to mitigate risks in the agricultural sector and enhance food security. Recommendations include
strategies to stabilize exchange rates to safeguard food supply and overall food security.
