Acta Universitatis Danubius. Œconomica, Vol 15, No 3 (2019)

Abstract

The study investigated the effect of commercial bank on real sector development in Nigeria over a period of 37 years (1981-2017). Data on commercial bank credit to Agricultural sector, interest rate, Agricultural guarantee credit scheme and Agricultural productivity were sourced from Central Bank of Nigeria Statistical Bulletin. ADF unit root test, Johansen cointegration test and error correction model techniques where employed as analytical tools. The result showed that there exists a longrun relationship between the bank credit and Agricultural development in Nigeria. The study found that the ECM is negative and statistically significant at 5% level of significance. The study also found that commercial bank credit to Agriculture and Agricultural guarantee credit scheme are positively related to Agricultural development while interest rate was found to be negatively related to Agricultural development in Nigeria. The study concluded that commercial bank significantly affect Agricultural development in Nigeria.