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Economic and Financial Review

Article Title

The impact of lending rate on the manufacturing sector in Nigeria

Abstract

The study investigates the impact of lending rate on output of the manufacturing subsector using the vector error correction model and annual data from 1981 - 2014. The empirical results indicated that high lending rate had negative impact on manufacturing output in the long-run. The study, therefore recommends the implementation of investment friendly policies that narrows, the lending rate by the deposit money banks in order to stimulate output growth in the manufacturing sub-sector and allow global competitiveness of products.