Monetary policy, development finance institutions and agricultural sector performance in Nigeria
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Fiscal and Financial Economists Society of Nigeria in conjuction with Fiscal and Monetary Economics Forum, Department of Economics, University of Lagos: Lagos, Nigeria.
This study examines the relative impact of monetary policy stance and the activities of development finance institutions on agricultural sector performance. The study asserts that the relatively unchanged monetary policy stance of the Central Bank weakens its effectiveness on agricultural sector performance as empirically proven and thus, this study employs the Autoregressive Distributed Lag Model (ARDL) with data spanning through 1981 till 2019 to achieve its objective. The results from the study show that although the monetary policy is effective in stimulating the activities of the agricultural sector in the short run, it is not in ensuring long term improvements of the sector in the long run. However, the activities of the development finance institutions proved effective in enhancing the productivity of the sector by providing liquidities on a long-term basis. The policy implication of this study is that the conventional monetary policy does not stimulate long term improvements in the agricultural sector while activities of the development finance institutions such as the provision of loans are more effective in stimulating the performance of the sector. Monetary authority through regulations will need to devise more effective ways of empowering the ability of the development finance institutions to mobilize financial resources that are needed for the stimulation of the activities of the sector.
Iwegbu, O., & Nwaogwugwu, I.C. (2022). Monetary policy, development finance institutions and agricultural sector performance in Nigeria. In I.C. Nwaogwugwu, & C.A. Ighodaro (eds.). Dynamics of fiscal and monetary policies in Nigeria: Issues, design and operations (Chp. 6, pp. 123 – 141). Fiscal and Financial Economists Society of Nigeria in conjuction with Fiscal and Monetary Economics Forum, Department of Economics, University of Lagos: Lagos, Nigeria.