Agricultural financing, output and macroeconomic growth. (2016)

• Record Type: Journal Article
• Authors: Obudah, Bodiseowei C.; Tombofa, Steve S.
• Is Part Of: African journal of economic and sustainable development. Volume 5:Number 4(2016)
• Page Start: 287
• Page End: 301
• Publication Date: 2016
• Subjects: agricultural financing -- agricultural output -- economic growth -- agricultural credit -- loan default -- loans -- agriculture -- macroeconomic output -- Nigeria -- credit default -- interest rates -- farmers -- farmer cooperatives; Sustainable development -- Africa -- Periodicals; 333.709605
• Languages: English
• ISSNs: 2046-4770

Abstract

This paper examined the effect of agricultural financing on agricultural output and macroeconomic output in the Nigerian economy. The error correction results from the analysis of time series data provided empirical evidence that there is a positive relationship between agricultural credit and agricultural output. Agricultural credit also had a positive effect on real GDP growth over the period of the study. However, credit default by borrowers is a serious menace which reduces the confidence of lenders. The Nigerian legal system should ensure a better credit enforcement mechanism and effective management of interest rates by monetary authorities. In addition, credit facilities and subsidies that would trickle down to individual farmers and farmers' cooperative groups will provide the needed funds to enhance agricultural output as well as economic output in Nigeria.