An Empirical Analysis of the Impact of Interest Rate on Agriculture in Nigeria

Abstract

This study using regression analysis tried to find connection between lending interest rate and agricultural sector activity in Nigeria for real and nominal values from the beginning of the fourth and current republic (1999) to 2016. Tests showed that interest rate had a strong significant negative relationship with agricultural sector activity. Because interest rate and monetary policy is currently not the main tool used by the federal government to improve this sector this recommended more favorable lending interest rates for farmers and industries to be used in sync with government spending in the agricultural sector as an effective way of improving its performance.

Keywords: Interest Rate, Agriculture, Crops, Livestock, Forestry, Fishing, Monetary Policy, Nigeria, Africa.

DOI: 10.7176/JESD/10-22-19

Publication date: November 30^th 2019