MSME FINANCING, AGRICULTURAL OUTPUT, EMPLOYMENT AND FOOD SECURITY IN NIGERIA
Keywords:
MSMEs financing; agricultural output; unemployment; food security.Abstract
Food (in)security is a critical problem in the Nigerian economy despite large parts of the population in agricultural activities and observation of agricultural surplus. Nigeria’s policy problem is thus, to identify policies that address the demand and supply side sources of food (in)security under economic conditions of adverse link of agricultural production to food security, poverty, lack of assets, and inadequate access to productive and financial resources. The objective of the study, therefore, was to examine the study’s proposition that MSMEs financing helped to ameliorate the adverse effect of agricultural output and unemployment on food availability and food access. The least squares regression with interactive terms technique was employed. The study finds that MSMEs financing improves the effect of real agricultural output and unemployment on food availability and food access with the implication of a threshold level of the loans at which the moderating influence become strong. The study recommends MSMEs financing as a policy for food security. The design of the policy should address loan adequacy, investments in agricultural value added and storage infrastructure goals.
JEL: D53, 013, J21, Q18.
References
Abdelhedi, I. T., & Zouari, S. Z. (2020). Agriculture and Food Security in North Africa: a Theoretical and Empirical Approach. Journal of the Knowledge Economy, 11(1), 193-210. https://doi.org/10.1007/s13132-018-0528-y
Amare, M., Abay, K., Tiberti, L., & Chamberlin, J. (2021, May). COVID-19 and food security: Panel data evidence from Nigeria. Food policy, 101, 102099. https://doi.org/10.1016/j.foodpol.2021.102099
Arltová M., & Fedorová, D. (2016). Selection of unit root test on the basis of length of the time series and value of the AR(1) Parameter. Statistika, 96(3), 47-64. https://www.czso.cz/documents/10180/32912822/32019716q3047.pdf/.
Bernhardt, I., & Jung, B. S. (1979). The interpretation of least squares regression with interaction or polynomial terms. The Review of Economics and Statistics, 61(3), 481-483.
Bizikova, L., Jungcurt, S., McDougal, K., & Tyler, S. (2020). How can agricultural interventions enhance contribution to food security and SDG 2.1? Global Food Security, 26, 100450. https://doi.org/10.1016/j.gfs.2020.100450
Brambor, T., Clark, W. R., & Golder, M. (2006). Understanding Interaction Models: Improving Empirical Analyses. Political Analysis, 14(1), 63–82. https://doi.org/10.1093/pan/mpi014
CBN, (2022). Central bank of Nigeria statistical bulletin. https://www.cbn.gov.ng/ documents/statbulletin.asp.
Endris Mekonnen, E., & Kassegn Amede, A. (2022). Food insecurity and unemployment crisis under COVID-19: Evidence from sub-Saharan Africa. Cogent Social Sciences, 8(1), 2045721. https://doi.org/10.1080/23311886. 2022.2045721
Etana, D., & Tolossa, D. (2017). Unemployment and food insecurity in Urban Ethiopia. African Development Review, 29(1), 56-68. https://doi.org/ 10.1111/1467-8268.12238
FAO, (1996). Report of the World Food Summit, 1996, November 13-17. https://www.fao.org/3/al936e/al936e00.pdf.
FAO, (2024). Suite of food security indicators. [Retrieved: 2024, March 19]https://www.fao.org/faostat/en/#data/FS.
Hayashi, F. (2001). Econometrics. Princeton, NJ: Princeton University Press.
Ketley, R. (2012, March). Promoting Access to Credit for MSMEs through Effective Government Interventions. EFINa. [Access Date: 2024, March 1]. https://www.efina.org.ng/wp-content/uploads/2019/01/Access-to-Credit-forMSMEsGenesis-Presentation.pdf.
Lv, F., Deng, L., Zhang, Z., Wang, Z., Wu, Q., & Qiao, J. (2022). Multiscale analysis of factors affecting food security in China, 1980–2017. Environmental Science and Pollution Research, 29(5), 6511-6525. https://doi.org/10.1007/ s11356-021-16125-1
Modi, R. (2019). The role of agriculture for food security and poverty reduction in SubSaharan Africa. The Palgrave handbook of contemporary international political economy, 391-410. Palgrave Macmillan, UK. https://www.springerprofessional.de/ en/the-role-of-agriculture-for-food-security-and-poverty-reduction-/16354876.
Ogbonnaya, C. M., Nwachukwu, A. C., & Uwazie, U. I. (2022). Agricultural Credit Financing and Agricultural Output Performance in Nigeria. Lafia Journal of Economics and Management Sciences, 7(2), 38-59. https://lajems.com/index.php/ lajems/article/view/220.
Ogunmokun, O. C., Mafimisebi, O., & Obembe, D. (2024). Bank lending behaviour and small debt financing. Journal of Entrepreneurship in Emerging Economies, 16(3), 675-697. https://doi.org/10.1108/JEEE-02-2022-0043
Enakhe, O., & Tamuno, S. (2021). Poverty, Unemployment and Food Insecurity: Empirical Evidence from Nigeria. Asian Journal of Economics, Business and Accounting, 21(6), 107-123. https://doi.org/10.9734/ajeba/2021/v21i630395
Pangaribowo, E. H., Gerber, N., & Torero, M. (2013, March 23). Food and Nutrition Security Indicators: A Review. ZEF Working Paper, 108, 63. https://doi.org/10.2139/ssrn.2237992
Perron, P. (1989). The great crash, the oil price shock, and the unit root hypothesis. Econometrica, 57(6), 1361-1401.
Qureshi, M. E., Dixon, J., & Wood, M. (2015). Public policies for improving food and nutrition security at different scales. Food Security, 7(2), 393-403. https://doi.org/10.1007/s12571-015-0443-z
Restrepo, B. J., Rabbitt, M. P., & Gregory, C. A. (2021, January). The effect of unemployment on food spending and adequacy: Evidence from coronavirus‐induced firm closures. Applied Economic Perspectives and Policy, 43(1), 185-204. https://doi.org/10.1002/aepp.13143
Rose, D. D. (2008, August). Interventions to reduce household food insecurity: a synthesis of current concepts and approaches for Latin America. Revista de Nutrição, 21, 159-173. https://doi.org/10.1590/S1415-52732008000700014
Sen, A. (1981). Poverty and Famine: An Essay on Entitlement and Deprivation. New York, Oxford: Clarendon Press.
SMEDAN, (2022). The Nigeria MSME report 2022: Fuel for Africa’s next Billion Businesses. https://smedan.gov.ng/wp-content/uploads/2022/07/Kippa-MSMEReport.pdf.
Smith, L. C., El Obeid, A. E., & Jensen, H. H. (2000, March). The geography and causes of food insecurity in developing countries. Agricultural Economics, 22(2), 199-215. https://doi.org/10.1111/j.1574-0862.2000.tb00018.x
Tackie, E. A., Chen, H., Ahakwa, I., Amankona D., & Atingabili, S. (2023). Drivers of food security in West Africa: Insight from heterogeneous panel data analysis on income-level classification. Environmental Science and Pollution Research, 30(37), 87028-87048. https://doi.org/10.1007/s11356-023- 28548-z
Taiwo, O. S., Hakan, A., & Savaş, Ç. (2022). Modeling the Impacts of MSMEs’ Contributions to GDP and their Constraints on Unemployment: The Case of African’s Most Populous Country. Studies in Business and Economics, 17(1), 154-170. https://doi.org/10.2478/sbe-2022-0011
Tambi, M. D., & Bime, W. J. (2019). Adequate Financing and Agricultural Production: Response to new generation agriculture in Cameroon. (JASc) Journal of Agribusiness Sciences, 3(1), 1-15. https://doi.org/10.30596/jasc.v3i1.3557
Thomas, A. H., & Turk, R. A. (2023, March 6). Food insecurity in Nigeria: Food supply matters: Nigeria. International Monetary Fund, 27. https://tinyurl.com/3vppdzdn.
Timmer, P. (2004, December). Food security and economic growth: an Asian perspective. Center for global development, 51. https://www.files.ethz.ch/isn/ 35774/2004_12_13.pdf.
Tomlinson, I. (2013, January). Doubling food production to feed the 9 billion: a critical perspective on a key discourse of food security in the UK. Journal of Rural Studies, 29, 81-90. https://doi.org/10.1016/j.jrurstud.2011.09.001
Wudil, A. H., Usman, M., Rosak-Szyrocka, J., Pilař, L., & Boye, M. (2022). Reversing years for global food security: a review of the food security situation in Sub-Saharan Africa (SSA). International Journal of Environmental Research and Public Health, 19(22), 14836. https://doi.org/10.3390/ijerph 192214836
Downloads
Published
How to Cite
Issue
Section
License
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).
