The Effect of Credit on Output: Are There Sectoral Differences?
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Publisher:Ohio State University. Department of Agricultural, Environmental, and Development Economics
Series/Report no.:Ohio State University. Department of Agricultural Economics and Rural Sociology. ESO (Economics and Sociology Occasional Paper). No. 2230
The urban bias in Philippine development policies is posited to have penalized the growth of rural manufacturing enterprises. On the other hand, trading and service activities have been driving the development process in rural areas, given that agriculture's performance has been less than desirable during the past decade. Under this scenario, there appears to be reasonable grounds for questioning the continued bias of formal financial institutions toward the manufacturing sector. This paper investigates the existence of sectoral differences in the effect of borrowing by rural manufacturing and nonmanufacturing enterprises in the Visayas Region of the Philippines