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Credit Supply and Rice Output in Nigeria: Empirical Insight from Vector Error Correction Model Approach

Author

Listed:
  • Osaretin Kayode Omoregie

    (Lagos Business School, Pan-Atlantic University, Nigeria)

  • Fredrick Ikpesu

    (School of Management and Social Science, Pan-Atlantic University, Nigeria,)

  • Abraham Emmanuel Okpe

    (Federal University of Agriculture, Makurdi, Benue State, Nigeria.)

Abstract

This study investigated the effect of credit supply on rice output in Nigeria within the periods 1981 to 2016 by employing the VECM approach. Findings from the research revealed that a rise in credit supply would lead to increase in rice output. In addition, the study indicated that a shock in investment, and labour would cause decline in rice output while a shock in money supply and inflation rate would cause rice output to rise in the country. Based on the result of the study, it is recommended that government in partnership with deposit money banks should create a scheme that will provide an interest free loan to farmers that are involved in rice production. Also, government should encourage rice farmers by supplying them farm inputs (which includes the provision of high yielding varieties, fertilizers, land, irrigation) at a subsidizes rate.

Suggested Citation

  • Osaretin Kayode Omoregie & Fredrick Ikpesu & Abraham Emmanuel Okpe, 2018. "Credit Supply and Rice Output in Nigeria: Empirical Insight from Vector Error Correction Model Approach," International Journal of Economics and Financial Issues, Econjournals, vol. 8(5), pages 68-74.
    • Handle: RePEc:eco:journ1:2018-05-11
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    References listed on IDEAS

    as
    1. Mahoukede, Kinkingninhoun-Medagbe & Aliou, Diagne & Gauthier, Biaou, 2015. "Impact of Use of Credit in rice farming on rice Productivity and Income in Benin," 2015 Conference, August 9-14, 2015, Milan, Italy 211635, International Association of Agricultural Economists.
    2. Mr. Paul Cashin & Ms. Catherine A Pattillo & Ms. Ratna Sahay & Mr. Paolo Mauro, 2001. "Macroeconomic Policies and Poverty Reduction: Stylized Facts and an Overview of Research," IMF Working Papers 2001/135, International Monetary Fund.
    3. Boansi, David, 2013. "Output supply and yield response of rice in Nigeria: implications for future rice policy," MPRA Paper 48080, University Library of Munich, Germany.
    4. Ogechi Adeola & Fredrick Ikpesu, 2016. "An empirical investigation of the impact of bank lending on agricultural output in Nigeria: A vector autoregressive (VAR) approach," Journal of Developing Areas, Tennessee State University, College of Business, vol. 50(6), pages 89-103, Special I.
    5. Diagne, Aliou & Zeller, Manfred, 2001. "Access to credit and its impact on welfare in Malawi:," Research reports 116, International Food Policy Research Institute (IFPRI).
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Chandio, Abbas Ali & Jiang, Yuansheng & Ahmad, Fayyaz & Adhikari, Salina & Ain, Qurat Ul, 2021. "Assessing the impacts of climatic and technological factors on rice production: Empirical evidence from Nepal," Technology in Society, Elsevier, vol. 66(C).
    2. Zakia Batool & Qurat ul Ain & Abdul Rehman, 2024. "Exploring the effects of farm mechanization, financial development, and renewable energy on China’s food production," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(7), pages 18883-18902, July.
    3. Abbas Ali Chandio & Yuansheng Jiang & Waqar Akram & Ilhan Ozturk & Abdul Rauf & Aamir Ali Mirani & Huaquan Zhang, 2023. "The impact of R&D investment on grain crops production in China: Analysing the role of agricultural credit and CO2 emissions," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(4), pages 4120-4138, October.

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    More about this item

    Keywords

    Credit Supply; Rice Output; VECM;
    All these keywords.

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

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