Effect of Agriculture on Sustainable Financial Sector’s Growth in Nigeria
Journal Title: Journal of Economics, Finance and Management Studies - Year 2023, Vol 6, Issue 09
Abstract
Plethora of studies has been concluded on the relationship between agriculture and economic growth, including a few other sectors of the economy. However, no attention has been accorded the relationship between agriculture and the financial sector in line with Demand-Following Hypothesis. Against this backdrop, this study examined the effect of agriculture on the sustainable growth of the Nigerian financial sector from 1999 to 2020. Data were collected from the secondary source and extracted from the Central Bank of Nigeria’s Statistical Bulletin. Analysis of the data was carried out using Autoregressive Distributed Lags Model (ARDL). The result revealed that the variables were co-integrated in the long-run; in addition, credits granted to agricultural sector by the financial institutions (GCA), amount granted to agricultural sector under Agricultural Credit Guarantee Scheme (ACGS) were positively but insignificantly associated with the growth of the financial sector in the long-run with the coefficients: 0.008GCA (p-value = 0.1511>0.05), 0.002ACGS (p-value = 0.4452>0.05). The productivity of the agricultural sector (AGRPROD) however, with coefficient 1.002AGRPROD (p-value = 0.0001<0.05), was predominantly positive and statistically significant in influencing the sustainability of the Nigerian financial sector’s growth in the long-run; this thus amounted to confirmation of Demand-Following Hypothesis. Furthermore, the lending interest rate maintained negative but insignificant effect on the growth of the financial sector in Nigeria. Based on the foregoing result, the study concluded that agriculture positively and significantly promoted the sustainability of the Nigerian financial sector, and recommended accordingly, that agricultural sector should be given top priority in terms of funds and other resources allocation as this culminates in stimulating financial sector’s sustainable growth in Nigeria.
Authors and Affiliations
Ogunlokun Ayodele Damilola, Adeleke Kareem O. (Ph. D)
Keywords
Related Articles
- EP ID EP727349
- DOI 10.47191/jefms/v6-i9-09
- Views 127
- Downloads 0
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