Monetary Policy Variables and Agricultural Development in Nigeria

ABSTRACT : The goal of any country’s monetary policy is to maximize economic production ; thus, themonetary authorities of that country use monetary policy variables to regulate the money supply, interest rates,and other aspects of the money market. From 1999-2017, when the Central Bank of Nigeria (CBN) employed awide range of monetary policy variables to stimulate the economy, this study employs the multiple regressiontechnique to examine the relationship between agricultural output, government spending, money supply, andinflation rate in Nigeria. This research found that financial policy measures can be used to affect agriculture,which would have a positive knock-on effect on agricultural development and, ultimately, Nigeria’s economicgrowth and development. Both tools of monetary policy have the potential to promote agricultural growth withthe right policies in place.

KEYWORDS : Agricultural Output, Government Spending, Inflation Rateand Money Supply.