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Impact of Employment on Access to Credit of Non-Agricultural Household Enterprises in Nigeria

Author

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  • Edith C. Obiefuna
  • Obed I. Ojonta
  • Jonathan E. Ogbuabor

Abstract

Purpose: The study examines impact of employment on access to credit by non-agricultural household enterprises in Nigeria using binary logistic regression approach. Design/Methodology/Approach: The data for the study was drawn from General Household Survey (Wave 4) published by the National Bureau of Statistics in 2019. Apart from the core variables studied, other variables considered in the study include: spending on other business costs, spending on rent, spending on transport, spending on salaries, and location of the enterprise. Findings: The findings indicate that employment is positive and significantly influence access to credit by non-agricultural enterprises in Nigeria. Interestingly, the influence of employment on access to credit by household non-agricultural enterprises is consistent even when the estimation is disaggregated into rural and urban enterprises. When disaggregated into rural and urban enterprises also revealed that spending on other business is negative and significantly influence access to credit by urban non-agricultural household enterprises while spending on transport is positive and significantly influence access to credit by rural non-agricultural household enterprises. Other factors like location, spending on rent, and salaries exert insignificant for access to credit. The study concludes that there is need for adequate policies that will promote employment through job creation. Practical Implications: Originality/Value:

Suggested Citation

  • Edith C. Obiefuna & Obed I. Ojonta & Jonathan E. Ogbuabor, 2023. "Impact of Employment on Access to Credit of Non-Agricultural Household Enterprises in Nigeria," International Journal of Finance, Insurance and Risk Management, International Journal of Finance, Insurance and Risk Management, vol. 13(3), pages 96-112.
    • Handle: RePEc:ers:ijfirm:v:13:y:2023:i:3:p:96-112
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    References listed on IDEAS

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    1. Obed I. Ojonta & Divine N. Obodoechi & Paschaline N. Ugwu, 2021. "Start-up Capital Source and Credit Access Participation of Household Nonfarm Enterprises in Nigeria: Evidence from Logistic Regression Model," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 19(3 (Fall)), pages 249-267.
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    More about this item

    Keywords

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    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • R20 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • N17 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Africa; Oceania

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