AGRICULTURAL SECTOR FINANCING AND EMPLOYMENT GENERATION IN NIGERIA – International Journal of Social Sciences and Management Review

AGRICULTURAL SECTOR FINANCING AND EMPLOYMENT GENERATION IN NIGERIA

Authors: Charles, Daniel, Akidi, Victor & Oladosu, Isaac Olubiyi

ABSTRACT

This study empirically evaluated the effect of financing the Nigeria’s agricultural sector on employment generation from 1990 to 2021. Theories adopted include: Financial Development Theory, Supply Leading Theory and Classical Theory of Unemployment. Annual time series data extracted from Central Bank of Nigeria’s statistical bulletin and World Bank’s World Development Indicators were used. The methodological processes of the ordinary technique of Least Squares (OLS) and the vector technique of Error Correction (VECM) Modelling were applied for estimations. The results from unit root’s tests showed all variables as stationary at I(1), that is orders one. Following this, the OLS and VECM estimates’ results established that agricultural sector received bank credits, government’s expenditures in the sector, Credit Guarantee Scheme Fund in agriculture and foreign aids in agricultural sector had short-run and long-run positively significant influences on employment generation while foreign direct investment in agricultural sector is insignificantly positive on employment generation. Sequel to the results, it is concluded that agricultural financing significantly contributes to employment generation in Nigeria. Therefore, suggested recommendations among others are that government’s expenditures in agricultural sector should be increased and other sources of financing for the sector be intentionally encouraged as such action will sustainably deepen agricultural sector’s performance, and consequently boost employment generation in Nigeria.

Keywords: Agricultural Financing, Employment Generation, Agricultural Credits Guarantee Scheme Funds, Foreign Direct Investments, Foreign Aid

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