ABSTRACT

This study was designed to examine the impact of migrant remittances on efficiency and welfare among smallholder arable crop farm households in South Eastern Nigeria. Despite the striking importance of migration and its socioeconomic and political implications, it is the least studied demographic phenomena in West Africa (Konseiga, 2004; Quartey, 2006). Remittances from migration may be seen as a source of cash earnings to give value to the agricultural land. According to Hernandez-Coss and Bun (2006), Nigeria is the largest recipient of remittances in Sub-Saharan Africa. They reported that the country receives nearly 65 percent of officially recorded remittance flows to the region and 2 percent of global flows. However, while studies on remittances and its impact on poverty had been carried out mostly in Central America and the Caribbean countries (Adams and Page, 2004; Taylor et a!, 2005; Yang and • Martinez, 2005) and in Ghana (Quartey, 2006), existing knowledge show that little on the subject has been done in Nigeria especially in South Eastern Nigeria (e.g. Nwajiuba, 2005; Odimuko and Riddell, 1979). Again, while the existing few such as Nwajiuba (2005) focused only on poverty or livelihoods, this study, given the rapidly changing "rural reality", attempted to provide empirical evidence on the impact of migrant remittance on agricultural production, resource use of farm households, and welfare of receiving and non receiving rural farm households. A multi-stage random sampling and purposive sampling technique were used in choosing the sample. This involves the random selection of 2 States, Abia and Imo, from the 5 states in South Eastern Nigeria; the random selection of 2 Local Government Areas (LGAs) out of the 17 and 27 in Abia and lmo States respectively; the random selection of 3 communities from each LGA and the purposive selection of remittance receiving and non-remittance receiving arable crop farm households forming the respective sampling frames in each chosen community, from which 3 households each were randomly selected. In all, 120 respondents were used for the study comprising 60 migrants' remittance receiving households and non remittance receiving households, respectively. Data collected through the cost route method from the respondents using structured questionnaire and interview schedules were analyzed using such statistical and econometric tools like frequencies, percentages, averages, t-test statistic, multiple regression analysis by the ordinary least squares and stochastic frontier production function and profit function analysis as well as Chow's test. The results of data analyses show that there were significant differences in age, farm size, output and income between the remittance receiving and non-receiving households. The main uses of fund remitted were for agricultural investments, household consumption, clearing debts, house construction/maintenance, payment of school fees and purchase of land. The significant determinants of migrant remittances were age of household head, the amount of household land holding, the mean age of migrants in a household, the average duration of migration, the dependency ratio, and the number of migrants in a household. Household size, education, farming experience, and farm size were the significant determinants of technical efficiency of the remittance receiving households; while age, years of education and farm size were the significant determinants of technical efficiency of the non-remittance receiving households. The mean technical efficiencies of the remittance receiving and non receiving households were 0.42 and 0.53 respectively. The significant factors influencing the economic efficiency of the remittance receiving households were age of household head, gender of household, household size, farming experience, membership of association and access to credit and extension contact while for the non-remittance receiving households, the factors were household size, gender of household head, extension contact and membership of association. The mean economic efficiencies of the remittance receiving and non receiving households were 0.48 and 0.88 respectively. For the determinants of aflocative efficiency of the households, the result shows that age of household head, household size, extension contact, membership of association, and gender of household head are positively related to allocative efficiency of the remittance receiving households. For their counterpart, household size and gender of household head were negatively related to allocative efficiency, while farming experience was positively related to allocative efficiency. The mean allocative efficiency of the households was 0.89 for the remittance receiving households and 0.93 for the non receiving households. The result further indicated that the average and the least allocatively efficient farmer from the remittance receiving farm households would require a cost saving of 8.25 percent and 80.71 percent respectively, to attain the level of the most efficient farmer in their group; while the average and the least allocatively efficient • farmer from the non receiving farm households would require a cost saving of 5.10 percent and 81 .63 percent respectively, to attain the level of the most efficient farmer in their group. The t test revealed that the non-remittance receiving households were more technically, economically and allocatively efficient than the remittance receiving households. On welfare, the result shows that sex of household head, household size, household age composition, income and sector of employment were the significant factors influencing the welfare of the remittance receiving households; while sex, years of education, composition of household work force and sector of employment were the significant factors influencing the welfare of the non-remittance households. The Chow's test revealed that the remittance receiving households have higher welfare status than their counterpart. It was recommended that there is the need to encourage the households to pursue efficiency in resource utilization by exhibiting higher levels of entrepreneurial capabilities. Policies and programmes that could help them increase their efficiency and welfare should be put in place such as would encourage harnessing and optimizing the use of remittance income, improving famers' access to extension 4 and technical services as it provides the medium for transmission of agricultural innovations and other information among others.