Examination of the Determinants of Credit Constraints in the Rural Agricultural Credit Market of Nigeria

摘要

Improving and sustaining production efficiency of small farmers under the dominance of borrowingconstraints require the improvement of access to credit among other factors of production. Although, there hasbeen a substantial literature on credit rationing in developing world, there is surprisingly little information onthe characteristics of farmers who are likely to be affected by the factors identified to be the credit constraints.Therefore, using data of 171 respondents from the household survey, the research provides new evidence oncredit rationing and borrowing constraints for rural farmers in Nigeria. The estimates of the probit regressionmodel reveal that constraints to credit is negatively related to educational attainments of the farmers, familymembers and positively correlated with high off-farming income and secondary occupation. Based on thefindings, the study recommends the need for the policy makers to strengthen the lending capacity of rural creditmarkets, redesign the educational system and encourage micro businesses in the rural areas.