COMMERCIAL BANK FINANCING AND DEVELOPMENT OF CROP PRODUCTION IN NIGERIA

Abstract

This study evaluates both short-run and long-run impacts of credit financing facilities provided by commercial banks on crop production development in Nigeria from 1981 to 2020. The study adopts ex post-facto research design and obtains data on the study variables from Central Bank of Nigeria Statistical Bulletin and World Bank Development Indicators. Autoregressive Distributed Lag (ARDL) model approach was employed as an estimation technique. The outcome of the analysis produces significant negative effect of commercial banks loans and advances on crop production development in the short run. In the long run, however, commercial banks loans and advances and labour employment in agriculture sector exert significant positive impact on crop production development in Nigeria. The researchers conclude that commercial banks credit financing significantly increase contribution of agriculture to Nigeria gross domestic product in the long-run while it reduces crop productivity in the short-run.