Title: The impact of financial development on aquaculture production in Australia: implications for industry policymaking
Authors: Chamil W. Senarathne; Tissa Ravinda Perera
Addresses: School of Business, Faculty of Business, Colombo Institute of Research and Psychology, 230 Galle Road, Colombo 04, Sri Lanka ' Department of Management and Organisation Studies, Faculty of Management and Finance, University of Colombo, Sri Lanka
Abstract: The objective of this paper is to examine the impact of financial development on aquaculture production in Australia using FMOLS, ARDL bound test and Engle-Granger cointegration test approaches from an annual data sampling period of 1960 to 2014. The FMOLS test results suggest that there is a long-term impact of financial development on aquaculture production in Australia. ARDL bound test indicates that there is a long-run relationship among aquaculture production, financial development and electricity consumption. Engle and Granger test also confirms that there is a long-run cointegration relationship between aquaculture production and financial development. Although there is no short-run (contemporaneous) relationship between the aquaculture production and financial development, one year lag period financial development significantly and negatively impacts the current year aquaculture production as the financing needs are mostly for long-term financing rather than short-term such as purchase of land, machinery, equipment and vehicles or farm development. These findings indicate that there is mismatch between firms' financing needs and financing terms offered. Implications for policymaking are discussed.
Keywords: financial development; aquaculture production; domestic credit; farm debt mediation; rural lending; structured financing.
International Journal of Agriculture Innovation, Technology and Globalisation, 2021 Vol.2 No.3, pp.242 - 261
Received: 11 Oct 2020
Accepted: 05 Mar 2021
Published online: 03 Mar 2022 *