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Effects of Social Capital on Credit Access and Credit Amount by Household Nonfarm Enterprises in Nigeria

Version
1
Resource Type
Dataset
Creator
  • Nwosu, Emmanuel O. (Department of Economics, University of Nigeria)
Publication Date
2018-01-06
Description
  • Abstract

    This paper investigates the effects of social capital on access to credit by household nonfarm small enterprises in Nigeria. Specifically, the paper tries to ascertain how social capital determines ability of household small business to borrow from formal and informal sources and the amount of credit accessed. The study uses data from the General Household Survey to estimate probit and Heckman selection model that form the basic models of the study. Specifically, the results show that belonging to informal groups increases the probability of accessing credit by 1.88%, and also has significant positive impact on the probability of using the loan to operate the enterprise. Also, membership of cooperatives significantly increases the probability of accessing enterprise loan. The results show that belonging to cooperatives and informal groups are the only social capital variables that have statistically significant impact on the amount borrowed. The key policy recommendation from this study is that forming themselves into social groups such as cooperatives and utilising existing social capital such as informal savings groups can help households to secure not only credit for their enterprises but also reasonable amounts of credit.
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Update Metadata: 2019-04-01 | Issue Number: 1 | Registration Date: 2019-04-01

Nwosu, Emmanuel O. (2018): Effects of Social Capital on Credit Access and Credit Amount by Household Nonfarm Enterprises in Nigeria. Version: 1. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset. https://doi.org/10.3886/E106280V1-11066