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Title: | Assessing the effect of off-farm income diversification on agricultural production in rural Nigeria |
Author: | Babatunde, Raphael O. |
Year: | 2012 |
Issue: | 106 |
Pages: | 44 |
Language: | English |
Series: | ASC working paper |
City of publisher: | Leiden |
Publisher: | African Studies Centre |
Geographic term: | Nigeria |
Subjects: | household income livelihoods agricultural production rural areas |
External link: | https://hdl.handle.net/1887/20202 |
Abstract: | Farming as a primary source of income has failed to guarantee sufficient livelihood for most farming households in developing countries, and agricultural development policies have largely produced little improvement, especially in Sub-Saharan Africa. Diversification into off-farm activities has become the norm. While the poverty and inequality effects of off-farm income have been analysed in different developing countries, much less empirical studies have been conducted on the impact of off-farm income on agricultural production and efficiency. Using survey data from rural Nigeria, this article examines the effect of off-farm income on farm output, expenditure on purchased inputs and technical efficiency among farm households. The results indicate that off-farm income has a positive and significant effect on farm output and demand for purchased inputs. Though the result does not establish that off-farm income improves technical efficiency, there is a slight efficiency gains in households with off-farm income. The findings of this study challenge the notion that participation in off-farm activities may lead to a decline in own-farm agricultural production, due to competition for family labour between farm and off-farm works. Rather, they tend to suggest that there are indeed elements of complementarities and positive spill-over effects between the farm and off-farm sectors of rural the economy. Removing credit market imperfections and upgrading rural infrastructure could enhance the development of both sectors simultaneously. [Book abstract] |