The Effect of Government Expenditure in Agricultural Output in Uganda. A Case Study at and a Coffee Development Authority (Ucda)

Abstract This study examined the effect of Government expenditure on coffee output and productivity in Uganda over the period 2005-2015 with time series data collected from Uganda Coffee Development Authority (UCDA), Uganda Bureau of Statistics (UBOS) and Bank of Uganda (BOU). The present study applied ADF Ordinary Least Square (OLS) technique as an analytical tool to analyze the data. The results of significance testing showed that there exists a long-run relationship among Government expenditure on coffee output, agricultural output and economic growth in Uganda. On the other hand, the empirical results of regression analysis revealed that Government expenditure has an insignificant effect on coffee output of Uganda. It was also found out that the coffee sector is still confronting some challenges like; inadequate funding, underdeveloped infrastructure, poor agriculture marketing. and shortage of irrigation etc. In conclusion, variables such as the tax revenue, grants & donations, public debt and external reserves account not for the variations in coffee output. due to lack of comprehensive time series data, other variables that are likely to influence coffee production were not incorporated in the models for statistical analysis. Therefore, the Government of Uganda should increase its expenditure in the development of the coffee sector since it would enhance coffee productivity