The Impact of Agricultural Export Product on Income and Employment in the Thai Economy

Abstract

From past to present, the Thai economy has been heavily export-dependent, with exports accounting for more than two-thirds of its gross domestic product (GDP). Agricultural export product is one of the main export products but its tendency is declining. The research objectives were to study the impact of agricultural export products on the income and employment of the Thai economy. In this research, the data applied were collected as the yearly time series for a period of 27 years from 1990 to 2016 by the Bank of Thailand. The primary data were collected from the stakeholders of the agricultural product export policy of Thailand. Data analysis was based on descriptive statistics by the arithmetic mean and standard deviation. The Monte Carlo Simulation technique and time trend analysis was applied to the forecasting of agricultural product export value. In addition, the impact of agricultural export product on income and employment measured by the econometric model and the estimated parameters were calculated by the ordinary least square technique. The research results revealed that: agricultural export product value of Thailand from 1990 to 2016 was $10.270 billion with its yearly growth rate of 4.984 percent, in addition, the forecasting of agricultural product export value of Thailand has increased but its growth rate has declined. The impact of agricultural export products has a positive impact on income in the Thai economy; agricultural product export value of Thailand increased 1 percent which, in turn, led to the income increase by 0.0051 percent. In addition, the impact of agricultural export product value has a positive impact on employment in the Thai economy; agricultural export product value of Thailand increased 1 percent which, in turn, led to the employment increase by 0.079 percent. The Thai agricultural export product policy should be focused on finished or semi-finished agricultural products instead of raw materials by applying technology and innovation to make value-added agricultural product export.