Thesis Abstract

Abstract
This study examines the relationship between commercial bank credit and agricultural output in Nigeria from 1982 to 2007. The agricultural sector plays a crucial role in the Nigerian economy, contributing significantly to employment, GDP, and export earnings. However, the sector has been faced with various challenges, including limited access to credit. Commercial banks are important sources of credit for the agricultural sector, and their lending activities can have a significant impact on agricultural output. Using time series data spanning 1982 to 2007, this study employs the autoregressive distributed lag (ARDL) bounds testing approach to cointegration to analyze the long-run relationship between commercial bank credit and agricultural output in Nigeria. The empirical results indicate a long-run positive relationship between commercial bank credit and agricultural output, suggesting that an increase in credit to the agricultural sector can lead to higher agricultural output in the long run. Furthermore, the study finds evidence of bidirectional causality between commercial bank credit and agricultural output in the short run, indicating that changes in credit availability can impact agricultural output, and vice versa, in the short term. This highlights the importance of credit availability in driving agricultural productivity and output levels in Nigeria. The study also examines the impact of other factors such as government expenditure on agriculture, exchange rate, and inflation on agricultural output. The results suggest that government expenditure on agriculture and exchange rate have a positive impact on agricultural output, while inflation has a negative impact. These findings underscore the importance of supportive government policies and stable macroeconomic conditions in promoting agricultural growth in Nigeria. Overall, the study provides valuable insights into the relationship between commercial bank credit and agricultural output in Nigeria. The findings suggest that increasing access to credit for the agricultural sector, along with supportive government policies and stable macroeconomic conditions, can contribute to higher agricultural output and overall economic development in Nigeria. Policymakers and stakeholders in the agricultural sector can use these findings to design effective strategies to promote agricultural growth and food security in the country.

Thesis Overview

This research examined the impact of commercial bank credit for agricultural production in Nigeria using macroeconomic variables (of commercial bank credit and agricultural products). The overall objective of the study is to examine to what extent the credits of commercial banks had supported agricultural production Nigeria. The specific objectives are: (i) to determine the impact of trade credit banks on agricultural production in Nigeria, and (i) to determine the impact of agricultural production on economic growth in Nigeria. The methodology adopted for the study was ordinary least squares (OLS) involving t-test of the student, to test the significance of the individual parameter estimate, the F-test, to test the significance of the regression plane overall, adjusted R2 and R2 to test the joint influence of the explanatory variables on the dependent variable.numerous raw materials into marketable finished products that are required in our daily existence as a people and as a nation. The sector generates foreign exchange through the exportation of its finished products. Realizing the importance of this sector, Nigerian government had before now, made concerted efforts to give reasonable support and assistance to the realization of the growth of the manufacturing sector in Nigerian economy. It is greatly accepted that the oil boom of the 70’s greatly improved Nigeria’seconomyand earned her industries need foreign exchange to import raw materials. Regrettably, thus boom changed drastically in the 80’s with the dwindling oil revenue. The effect however saw the folding up of some industries, thus, negatively affecting the manufacturing sector of the economy. The harsh economic situation of the time wholly informed that sectors should be opened so as to supplement the poor oil revenue. This unpleasant economic condition got worse with military leadership which was considered unstable. Yet, the manufacturing sector remains the most wanted sector to supplement the foreign exchange earnings of the oil sector through exportation of their finished products. Nevertheless, military regimes are known not to offer enabling environment for effective industrial growth but with the emergence of a democratically elected government in May 1999, the Nigerian nation started Finally, Durbin-Watson statistics (DW) was used to verify the presence or absence of serial correlation data. After the regression, the result shows that: firstly, agricultural production and the commercial bank credit to agriculture and the real interest rate have contributed to economic growth in Nigeria. Second, there is general agreement that Nigeria agricultural sector is severely underfunded. Finally, the share of actual expenditures that went to the agricultural sector in relation to adverse action that went to other sectors. Based on the foregoing, the researcher has the fluidity suggestions: It is necessary to improve the monitoring system of public expenditure in the agricultural sector. There is also the need to clarify the roles of the three levels of government in the provision of agricultural services.